The Impact of Bitcoin on the Housing Market
Bankforeclosuressale.com, The Market Leader In Foreclosure Listings Nationwide, Shares An Analysis Of The Cryptocurrency Space And How It Is Having A Significant Impact On Many Aspects Of The Housing Market
Over the past year, a growing number people are taking out second mortgages – such as in the form of a home equity line or loan – in order to purchase Bitcoin.
While there are safety and security reasons for making this decision, most individuals are doing so from an investment point of view, as the value of Bitcoin skyrocketed in 2017.
“It’s important for homeowners with equity in their property to realize that they have options,” said Simon Campbell, Real Estate Specialist of Bankforeclosuressale.com. “It doesn’t make sense for everyone to use a second mortgage to purchase Bitcoin, but it’s an investment just like any other. There is risk involved, but at the same time there is a big upside that could pay off in a big way over the course of several months or years – or even quicker.”
“If considering investing alternatives such as cryptocurrencies, the foreclosure market still offers some excellent, affordable and tangible opportunities in cities such as foreclosures homes in Ohio, New Jersey, Miami among others,” said Campbell.
While it’s the right of every homeowner to use their home’s equity however they best see fit, there are some risks associated with investing in Bitcoin. The most significant concern is the fact that cryptocurrency is relatively new to the world, meaning that there isn’t much history to pull from when making investment decisions.
The primary benefit of Bitcoin is the lack of a central bank or single administrator, which is something that an increasing number of individuals are interested in. But the same time, without any national government backing up the currency, there is always the risk that the entire system could collapse.
“Here’s the thing people need to understand about investing in Bitcoin: there is risk associated with it, just the same as the stock market and real estate,” added Campbell. “And when I say risk, I mean that this is very risky. When compared to traditional real estate investments, you’re taking a much more prominent risk with your money.
The problem that comes into play is when a person uses the equity in their home to gain access to funds for investing. If everything checks out and their investment grows, there’s no concern. However, if a person loses money, they may be unable to repay their loan. Subsequently, it could lead to a flood of foreclosures hitting the market.”
To this point, there isn’t much documentation regarding investors using their home’s equity to invest in Bitcoin. With this trend growing in popularity, 2018 has the potential to uncover a variety of high-level data, including any foreclosures associated with this investing strategy.
As the months go by, it’s important for investors to pay close attention to the direction that Bitcoin is trending.
Furthermore, any data associated with using a second mortgage to invest in cryptocurrency should be carefully considered.
Campbell said, “Every investment, regardless of the potential risk or reward, will always get people interested. This is particularly true with cryptocurrency, such as Bitcoin, because it’s so new to the world and its returns have been astonishing since its creation in January 2009. However, investors shouldn’t jump in feet first, assuming that Bitcoin growth will continue indefinitely.”
The above references an opinions and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.
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