How to choose between real estate investment and crypto-currencies?
First criterion: the capital (Real estate vs crypto-currencies)
The capital is the money you have in your bank account, available or not but which belongs to you.
You buy a property with a minimal or almost zero starting capital. And you have the following steps:
You get the financing from the bank,
This produces a strong leverage effect because it is the tenants who are going to repay your debt,
Later you will recover the capital that will have been amortized,
For a few years, you will get a net cash flow every month depending on the strategy of the real estate investment chosen.
In terms of capital, real estate investment is therefore very interesting.
However, in terms of capital, investing in crypto currencies is less interesting. Indeed, it is necessary to have previously placed in the bank a certain amount of initial investment placed on monetary supports:
The NFT, (NON-FUNGIBLE TOKEN = Non-fungible token that allows to justify an artistic purchase and to prove The authenticity),
The shares,
Crypto currencies,
Life insurance.
And there is no immediate leverage.
Second criterion: volatility (Real estate vs crypto-currencies)
The success for real property does not fade because real estate does not lose its value; the results are predictable if you do your calculations well. Moreover, insurance protects you in case of risk and you are sure to get cash.
On the other hand, volatility in crypto does exist. Yes, we can have very powerful growth factors but the fluctuations are real, both up and down. It is more risky especially on the long term.
Third criterion: taxation (Real property vs crypto-currencies)
Real property is a safe haven, but the associated taxation should not be neglected. Indeed, if you manage your real estate investment well, you don't pay taxes.
On the other hand, with money market investments, every time you want to get cash back you will have to pay taxes. As a result, the net value taken is greatly reduced.
Fourth criterion: the guaranteed capital (Real property vs crypto-currencies)
The guarantee is the stone. The security is to resell it (more expensive than what you paid for it). In any case, you always get back a capital.
With money market investments, the capital is never guaranteed, you can lose everything. Or you can earn money with a very small return. It's up to you to decide how much risk you want to take.
Other data to consider
The time scale
With real estate, the time scale is a bit longer than with crypto-currencies and requires a bit more patience.
The return on real estate investment is quicker with money media, but you have to take into account the luck factor.
The risk
With crypto-currencies, as with the stock market, you can win everything but you can also lose everything unlike real property. So you could use the capital used instead to create cash flow, assets ...
Conclusion
Real estate in 2023 remains the most powerful, secure and predictable investment vehicle. I still do crypto currency with an investment logic of 20/80 on reasonable amounts, depending on the risk of loss. As an investor, I think there are good deals to be had in this area.
It is therefore much more interesting to first look at real property for all its investments. Afterwards, it can be interesting to diversify its capital by investing in crypto-currency in order to diversify its investments. It is obviously very important to be well informed before investing in order not to lose what you invest. The best thing is to educate yourself and then take action to make the best choices.
