Rental Property Investor · Member since 2018 · 66 posts · 71 votes
If there is a market crash and if the USD keeps declining...
Then will you accept Bitcoin as a form of payment for your rentals, STR or LTR? We currently accept Bitcoin and Litecoin with no worry at all but we're curious what others think about this?
Technology is only advancing and a digital currency makes total sense. Especially one that's global for near instant, low/no fee, cross boarder payments. Makes more sense than a gold brick or a piece of paper thats just backed by a government that's hard to trust with money in the first place.
Rental Property Investor · Salem, OR · Member since 2017 · 696 posts · 660 votes
7y
@Account Closed I understand the idea, but whatever minimal transaction fees there might be are probably less than the complexity you are adding in valuing an asset and reporting it for rent instead of USD payment. You need to place a value on the crypto when you receive it and that's your taxable rent...not what it drops to 2 weeks later or goes up to etc. My point is this does not scale, the number of people who would pay that way is tiny. Fun in concept, irrelevant in practice. Think bigger, too much energy and time going into what is probably a few hundred or thousand in transactions.
Rental Property Investor · Member since 2018 · 66 posts · 71 votes
7y
@Bryan Mitchell I don't convert my Bitcoin for now. I'm expecting it to outperform the USD so that's the reason I accept it. This is only about accepting rental income in Bitcoin as a home owner. If the contractors didn't want to accept it, then you'd just pay them in USD like normal. That doesn't change anything from the rental income perspective.
I believe (obviously could be way off) that other countries will have their own Bitcoin reserves just as they do gold reserves. They have gold but still have their fiat.
Rental Property Investor · Member since 2018 · 66 posts · 71 votes
7y
@Mac F. Care to elaborate? Alot of things in today's world were derived from some past idea that was executed and brought into fruition from someone else at a later time. Not sure what that has to do with anything here.
Rental Property Investor · Member since 2018 · 66 posts · 71 votes
7y
@Matt R. He should've still paid taxes on the Bitcoin received for rent and if he sold it then he would've had to pay capital gains on it. I'm sure he still came out more ahead from it and that's a pretty cool story. Looking to hopefully repeat what he accomplished and I'm in it for the long term so I'm not worried about the volitility.
Rental Property Investor · Columbus, GA · Member since 2016 · 623 posts · 337 votes
7y
@John Mader, if a country can have a greater influence in world markets by leveraging cryptocurrency, they will. Still everyone will need to agree upon the currency that will set the standard right? All said, Investing in cryptocurrency can be seen as a way to diversify your portfolio.
Rental Property Investor · Member since 2018 · 66 posts · 71 votes
7y
@Scott Mac Agreed, which is why I don't pay attention to anything mainstream media. There are many areas where the market is doing fantastic and other areas where it's not or just seems to be inflated. There are for sure reasons to prepare for some kind of recession or market downturn whether now or in the next few years. It's not something to expect to happen 100% but it's not a dumb thing to anticipate and prepare for either. USD has been in a decline since it's inception, that's just a fact. Yes, It's stable, and relative to other fiat currencies it's strong but that doesn't mean in today's age that a better currency that doesn't inflate can't compete with it in the future. A digital currency and/or store of value makes sense to accept in order to hedge against that.
Denver, CO · Member since 2019 · 2 posts · 2 votes
7y
@David Barnett I agree. Crypto is purely speculative at this point. I do keep an eye on it, and blockshain is interesting technology, but there is currently nothing there to back the asset. The original poster should keep in mind that ROI is often tied to risk. The greater the return, the greater the risk. It sounds like he understands this and accepts the risk. I hope it works out for him. I'm with you in that I got into real estate for the stability it provides. I have a slush fund on the side that I use on high risk investments for fun.
Springfield, VA · Member since 2019 · 74 posts · 77 votes
7y
Originally posted by @Account Closed:
@Mac F. Care to elaborate? Alot of things in today's world were derived from some past idea that was executed and brought into fruition from someone else at a later time. Not sure what that has to do with anything here.
I posted a link to the wiki page for Mackey's Extraordinary Popular Delusions and the Madness of Crowds. Mackey's descriptions of classic financial bubbles and crowd psychology is still applicable today. And bitcoin, IMHO, fits this model as much as dot coms did before they crashes, telecoms before they crashed, gold before it crashed, etc...
Investor · Chicago, IL · Member since 2016 · 60 posts · 45 votes
7y
@Account Closed don't waste your breath trying to convert anyone here on cryptocurrency. The ones that believe are already into it and the others won't be believers until their brokers start hawking it for diversification. Real estate investing is the home for luddites. Obviously there are savvy investors that are also in REI but I think you catch my drift.
Here's my question though. How are you tracking the BTC income for taxes? None of the current software offerings are good enough to track this so are you doing it manually? How are you "proving" the USD price of BTC on a given day when you take receipt of funds?
Rental Property Investor · NY · Member since 2019 · 13 posts · 0 votes
7y
@John Mader
Very interesting, do you ever cash out and convert to USD?
And would you say you overall have made more money by accepting bitcoin? Essentially what I’m asking is across your portfolio, is it more advantageous for you to collect bitcoin, or would you have made more by collecting USD?
Waipahu, HI · Member since 2018 · 121 posts · 81 votes
7y
@Account Closed I think it is a great idea. I have been invested in crypto since 2014. I just wish I would have had more foresight in the possible price increase. I thought making 5 times my money was great. Should have waited, and had a more strategic plan. There is a great book called Cryptoassests. In this book actual financial analyst look at investing in crypto. Even with a small amount of ones portfolio held in bitcoin 1% of a persons portfolio annually. The annual return since bitcoins inception would be around 38%. I know many people love to trash bitcoin, but it is hard to argue with 38% return annual if you are only investing 1% of your portfolio. The importance of asset allocation is essential when investing in a risky asset. Let us know how it goes in a few months or year. I would love to see the possible returns you get from accepting it, and holding it long term.
Specialist · New York City, NY · Member since 2019 · 34 posts · 111 votes
7y
@John Mader
Why is it any different than allowing tenants to pay rent with stocks and bonds - they have been around for years already, so why isn't it commonplace?
Just turns your rental income from something relatively stable into something relatively volatile.
If you feel Bitcoin is a worthwhile investment, then by all means, take your rental income and buy as much Bitcoin as you want with it but why would anyone mix them together from the get go? They are completely separate investment vehicles with one being easy to predict what will it be next month and the other very hard to know what will it be next month - mixing them together isn't exactly good business sense.
And practically speaking, you cannot pay your repair guy or plumber in Bitcoin, nor the mortgage and insurance. The value changes from day to day and nobody can run a real estate operation or any other business with that kind of constant value fluctuation and unpredictability that comes with Bitcoin.
Longmont, CO · Member since 2019 · 22 posts · 0 votes
7y
Cryptocurrency Bitcoin really managed to revolutionize not only the Internet, but also in the global economy. It is thanks to her that blockchain technology has achieved such popularity over the past few years and is now actively being introduced into all areas of our lives. Bitcoin has clearly contributed to history and ushered in a new industry, but technology is evolving and user needs are growing. Undoubtedly, this cryptocurrency will be used for a long time and it is unlikely to be completely abandoned, but it is likely that it will soon cease to be the most important one.