I don't know how much crossover interest there is between RE on BP and crypto but there's an enormous amount of innovation happening in cryptocurrency finance that could be a great match for RE investing.
There's a new DeFi protocol called Alchemix Finance. There are a few different things you can do with this and if you're not already familiar with DeFi it might be extra confusing but this has incredible potential. Here's the best ELI5 I've seen...
That was taken from this article that provides an excellent summary and explanation of the product. Here's another explanation in case you still find this confusing.
So basically if you have enough capital, you can buy a property for free and effectively not spend a single dollar. Here's an example of someone doing exactly that with a $25k boat.
0xdef1 has created a calculator. If you're not familiar with DeFi, then this might seem a bit weird but stablecoins earn ridiculous returns. Right now 10.51% is the lowest return I've seen on the market for stablecoins. That's what's being used to self-pay the loan.
One way you could interface this with RE is as follows. Say you are looking at a BRRRR candidate that is going to cost 100k all in (purchase + repairs, etc). Assuming you want to go with the 50% LTV from Alchemix, you would input 200k into Alchemix to get a 100k loan. Buy it, repair it, rent it... now it's cash flowing. From here you could refi to pull your money out while just letting the auto-paying loan pay itself down over the next 2-5-ish years depending on stablecoin APY market rates... OR you could use the elevated cash flow from your 100% equity property to accelerate the pay down of the self-paying loan. All that money goes back to you once paid off so you are paying yourself, you're just accelerating the timeline for when the self-paying loan pays itself back and thus frees up all your collateral. Meanwhile the cash that you put in also comes back to you. So to stick with this thought experiment, let's say you now have your 100k property, it's cash flowing into Alchemix for 36 months (let's say 900/month), which means your loan collateral has gone up to 232.4k further accelerating the point at which the loan is paid off and all of that money comes back to you. After which you can then refi to get 1) a cashflowing property, 2) profit from the forced + natural appreciation (let's call it 150k), 3) you no longer owe any money so 100% of the value of the loan is now also yours, and 4) 100% of the collateral (232.4k).
There are other cool things you can do with Alchemix or you can choose a different LTV or entirely other products like the Celsius 25% LTV loan, which is tied with Alchemix for the most ridiculous loan I've ever seen (1% interest, 0% principle, ballo0n principle payment after 3 years (but you can refi it off into the future forever), zero fees of any kind or at any point, basically endless refi opportunities with and all zero fees, no origination, no credit check, NOTHING)... that's another one that blows my mind. With enough capital in either of these over-collateralized loans, you can do some crazy stuff.
Thought I should share in case anyone was interested. I don't yet have enough threshold capital to make such a deal work with these vehicles but I'm building up to it.
