Stagnant mortgage demand
Real estate markets are facing a tough time, with stagnant mortgage demand being attributed to rising interest rates. The average 30-year fixed-rate mortgage interest rate currently stands at 7.27%, leading to a significant drop in refinancing and home purchase applications.
House prices and inflation
Despite the challenges, analyst Marcel Pechman suggests that house prices may still rise if inflation continues to grow. Real estate, especially urban residential properties, has historically been a reliable store of value. Pechman highlights that in the current economic climate, other investment options may not provide a safer haven.
Instacart's IPO struggles
In another segment, Pechman discusses the initial public offering (IPO) of Instacart. The company was initially valued at $39 billion, but its IPO set its valuation at just $10 billion. This highlights the challenges faced by venture capitalists in the current economic climate.
Bitcoin's role as a reliable store of value
Pechman suggests that investor metrics need to shift towards a reliable store of value, and cryptocurrencies like Bitcoin (BTC) could play a role in this. He notes that Bitcoin can serve as a transparent reserve system for banks and nations, issuing Bitcoin-backed digital assets without relying on a billion users. Unlike precious metals that face auditing challenges, Bitcoin and other cryptocurrencies can fill the role of a reliable store of value regardless of everyday user adoption.
For more in-depth analysis, you can check out the Cointelegraph YouTube channel.
