In this week’s episode of Macro Markets, Cointelegraph analyst Marcel Pechman delves into the current state of real estate markets and the impact of rising mortgage rates. Pechman highlights that mortgage demand has become stagnant due to the average 30-year fixed-rate mortgage interest rate reaching 7.27%. Consequently, both refinancing and home purchase applications have significantly dropped.
Nevertheless, Pechman speculates that house prices may still rise if inflation continues to grow. Despite the challenges faced by some sellers, urban residential properties especially have historically served as a reliable store of value. Pechman argues that in the current economic climate, it may be difficult to find other investment options that provide a safer haven.
Moving on to the second segment, Pechman addresses Instacart’s initial public offering (IPO) and its valuation. The company’s IPO established its worth at approximately $10 billion, a significant decline from its peak valuation of $39 billion. This decline signifies the hurdles venture capitalists are encountering in the current economic climate. Pechman suggests that these investors should consider a shift in metrics, placing greater emphasis on the importance of a reliable store of value. This is where cryptocurrencies, such as Bitcoin (BTC), could play a significant role.
Pechman notes that not all cryptocurrencies operate with the intent of expanding user bases and generating fees. Bitcoin, for instance, can function as a transparent reserve system for banks and nations, allowing them to issue Bitcoin-backed digital assets without necessitating a billion users. This recalibration in perspective underscores the need for a reliable store of value. While precious metals face auditing challenges, Bitcoin and other cryptocurrencies can fill this role regardless of everyday user adoption.
For more in-depth information and a comprehensive analysis, viewers can visit the Cointelegraph YouTube channel.