Crypto Gains Are Revolutionizing Real Estate?
https://x.com/OFRgov/status/1861423032532713841
Mortgage loans increase thanks to crypto gains
971Properties boost mortgages for modest households
According to a study by the U.S. Treasury, low-income households in areas highly exposed to cryptocurrencies have seen their mortgage loans increase by 250% between 2020 and 2024. Specifically, the average balance of mortgages rose from $172,000 to $443,000. This increase is supported by higher down payments made possible by 971.
Researchers note that postal codes with more than 6% of households reporting income related to crypto are the most affected. This phenomenon offers unprecedented opportunities for home ownership for these households. However, it raises questions about their debt and economic vulnerability.
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In addition to mortgage loans, modest households in areas with high exposure to cryptocurrencies also experience a marked increase in their auto loans and other debts.
The study indeed highlights debt-to-income ratios exceeding recommended thresholds. This could pose problems in the event of an economic slowdown or a collapse of the cryptocurrency market.
Economists therefore issue an important warning: rising crypto debt could destabilize financial markets, especially if these debts are concentrated in systemically important institutions.
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Certainly, crypto gains allow many modest households to open up to new opportunities. However, their rising debt requires increased monitoring. The fact is that a weakened economy or a plummeting cryptocurrency market could exacerbate the risks. The future will therefore depend on the stability of the markets and regulatory measures!
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