I still see many ThemTubers who talk about crypto, as an asset, still talk about housing as an asset. (of course they still talk about stocks and bonds as an asset, but that is another story)
This is weird because housing, as an asset class, has only been around for about 75 years. (houses, not apartments in large cities)
Today, people are buying up houses so they can rent them out on weekends through AirBNB, and many of them are getting out as fast as they can. Cities are banning AirBNB, and so, your cash income could be turned off tomorrow. Well, it was a good gig while it lasted.
And there is a lot to be said for buying up houses, when everyone doesn't have one to live in yet. But this post is about how we have passed the peak of population, AND we are now on the downhill side with many death events in the near future.
By the time we recover from all of this, there will be swaths of empty houses that no one will ever use. People have moved on, to living in small communities with their tribe/family.
Some will take over an entire apartment complex, but most will build large, specialized multi-person/multi-family structures. And they will build them in places that are very good for supporting life (like mountains that block the storms) and they will not need to be near roads or power because that stuff will be unnecessary.
Housing is not an asset
Only in a financial climate where we have, basically, free money, can we even think of buying a house for the purposed of renting it out. Add to that, that we need a shortage of houses. And we have to have some people be able to get financing at a much cheaper rate than others.
Only with all of these things can you finance a house, that you will make money when renting.
In small villages around the world (usually in 3rd world countries), they do not have the concept of renting a house. Yet, we have made it normalized.
Imagine if we all paid 6% interest for any house (like a gov't program) then, how could you buy a house, and then rent it out and make your money back? You would have to rent it out for more than someone could buy one for. Basically you have to charge the renter: mortgage + insurance + repairs + maintenance.
So, if you could not get financing for less then the average person (and also drive the hardest bargains) you could not rent a house, except to people who would pay extra for "comprehensive insurance/maintenance" so that they had to do nothing to maintain their house.
Well, all three of the things that allows one to finance a house and rent it are going away.
- Mortgages are going away as more and more banks close/crash.
- There will be an abundance of vacant houses
- Being able to print money when creating out a loan will be a thing of the past.
Population is going down
All the developed nations have negative birthrates. We are in a population decline, and it will only be a short time before we really begin to notice.
When the boomers leave their houses, there will, quite suddenly, be 25% of the houses on the market. Markets usually do not survive a glut of inventory like that.
There are wars and rumors of wars. We will not be having WWIII, but a lot of grudges are going to be worked out. A group of people who have been separated by a border (imaginary line) will get back together. Groups who have been forced to live together by imaginary lines will break apart. There will be a lot of fighting, and a lot of death until people work out how to do these amicably.
The Covaids massacre is still working its way through the system. And the next plandemic will be worse. There will be a lot of deaths. I would suggest building a lot more crematoriums, but people don't want to accept that the clot-shot is deadly, yet.
One of the premises of having housing be rentable is that there is a lack of houses. Well, we will probably have two houses for each living person at some point soon.
Our view on property (the dirt stuff) changes
The boomers kicked their kids out at 18 and told them to go make their own way and get their own house. Today, many children are living with their parents. Because that dream only existed for a small amount of time. Where there was so much wealth AND fractional reserve lending.
Really, what kind of parent believes their just matured kids are able to buy a house? They are barely able to get a job. They haven't had any life to accumulate assets.
The real, natural order of things would be the parents make room for their children. Their should be room set aside for the child to grow up into.
The child that is not embraced by the community, will burn it down to feel its warmth.
The idea of telling your children to pay you more than you paid for the property is asinine. But, that is what we do today. They bought the house for $25,000, but we, in our young career/life, need to pay them $1,000,000. This is what happens when you have an inflationary currency, and a bunch of people who believe that house prices go up. So, pay up kid.
We will not do this in the future. We will think that this kind of treatment of young adults is abhorant.
For all of these reasons, housing is going to crash. And i do not mean, drop down like 2008 and then recover.
I mean, go away.
Real Estate - meaning, the kings estate. That entire paradigm will be scrubbed from our reality. There will not be any entities that is allowed to have all the real estate. In most places, there will be a buffer space between your property and your neighboring tribe's property. Thus stopping so many problems from not having any room to expand, to people walling each other off with tall fences, and then arguing about the fences.
Bureau of Land Management will be gotten rid of. In fact, sometime soon, the new government will give it away to people who need land to have a house. This new government will see that it is important for each person to have a property.
This will probably carry over to govern-cements. Where there will be space between what one govern-cement claims as theirs, and the next claims as theirs.
I am unsure if it is better to sell all your rental properties are just ride this thing into the scene of the crash. You will probably have to take quite a hit to sell it now, and if so, it is just better to hold on and rent for as much as you can until you cannot anymore. Further, it would be great to sell right now and buy into bitcoin, but selling takes time. And you may miss this bull run.
Maybe you can refinance, pulling out all the equity, pay off some of your houses completely, and then transfer them to another corporation.
But, anyway, in the not too distant future, people are just going to find an empty house and move in.