A house didn't used to be an investment. Under sound money it was shelter, bought with savings at two to three years' income. Fiat money turned it into the default savings account. Bitcoin now competes for that role.
For most of American history, a house was shelter. A consumable. Something you saved for and bought outright. The home-price-to-income ratio hovered around 2–3× for decades under sound money — the classical gold standard, the belle époque, even the managed gold standard of Bretton Woods. Then fiat happened. Each loosening of the monetary constraints — the Federal Reserve Act (1913), Roosevelt's break from gold convertibility (1933), the Nixon Shock (1971) — coincided with housing moving further from utility value and closer to its current role as the world's largest store of value. This page's argument is that the money is the reason.
~2×
Price-to-Income · Gold Standard
~3×
Price-to-Income · Bretton Woods
5.0×
Price-to-Income · 2025
Home-Price-to-Income Ratio by Monetary Regime
135 years of US housing affordability across five monetary eras · 1890–2025
Sources: Shiller Home Price Index (1890–), U.S. Census Bureau (MSPUS), BLS, FRED. Pre-1950 ratios derived from historical wage and housing data.
The pattern is consistent. Under the classical gold standard, with the dollar pegged at $20.67 per ounce, housing prices tracked incomes closely. The Federal Reserve Act of 1913 introduced the machinery of monetary expansion, but the gold peg initially constrained it. The critical inflection came in April 1933, when Roosevelt revoked gold convertibility and transformed federal debt from a claim on gold into a claim on dollars — what economists call the "Nominal Revolution." This enabled unbacked fiscal expansion that reflated asset prices, including housing, without a corresponding rise in real incomes. The 1971 Nixon Shock completed the transition, removing the last constraint. Each step loosened the monetary constraint, and each was followed by a higher price-to-income ratio.
The Monetary Eras
How each regime change altered the structural relationship between housing and income
1890 – 1912
Classical Gold Standard
Dollar pegged at $20.67/oz. No mechanism to reflate assets. Housing prices essentially flat in real terms for decades. Deflationary orthodoxy — houses bought with savings.
~2×
ratio
1913 – 1943
Federal Reserve Era & the Nominal Revolution
Fed created in 1913. Price level inflated 60% above the long-run average by the 1920s. The resulting debt-deflation crash of the early 1930s crushed both prices and incomes. In April 1933, Roosevelt broke gold convertibility — transforming federal debt from a claim on gold into a claim on dollars. This "Nominal Revolution" enabled unbacked fiscal expansion, but the Depression and WW2 suppressed the ratio through the period.
~2.5×
ratio
1944 – 1971
Bretton Woods — Managed Gold Standard
Global debt becomes claims to dollars, not gold directly. Semblance of constraint maintained. GI Bill subsidizes homeownership. Ratio stable but creeping upward as the machinery of monetary expansion, established in 1913–1933, begins to compound.
~2.5×
ratio
1971 – 2000
Pure Fiat — Early Era
Nixon severs last link to gold. No remaining constraint on monetary expansion. Capital flees to real assets. Housing transforms from shelter to store of value. The ratio climbs relentlessly.
~3.5×
ratio
2000 – 2025
Pure Fiat — Late Era
Dot-com crash, 2008 crisis, COVID stimulus — each met with massive unbacked fiscal expansion. $5 trillion+ in pandemic response alone. Housing reaches historic peaks relative to income.
~5×
ratio
2025 → ?
How Much Further?
Without a change to the monetary system, nothing in this record anchors the ratio. A possible counterforce has emerged: bitcoin, a money with a fixed supply, competes for the store-of-value role that fiat money pushed onto real estate. Whether it draws enough of that premium to bring the ratio down is the open question.
?
ratio
The Divergence: Home Prices vs. Incomes
Indexed to 100 in 1985 — nominal growth comparison · Home prices up +403%, incomes up +252%
Sources: U.S. Census Bureau, Bureau of Labor Statistics, FRED
The argument for why the trend held: savers had few alternatives. Gold was confiscated, regulated, and impractical for daily savings. Bonds were denominated in the same depreciating currency. Stocks required expertise and carried counterparty risk. On this reading, housing became the default by elimination. Bitcoin is a new kind of alternative. It is a bearer asset with a fixed supply that can be held with no mortgage, no property tax and no maintenance, though custody and volatility are costs of their own. If bitcoin absorbs part of the monetary premium in global real estate, the home-price-to-income ratio could move back toward its historical 2–3×. That is the thesis this page tests, not a measurement.
The fiat premium in housing: On this page's reading, the gap between the home-price line and the income line in the chart above is a store-of-value premium that fiat money pushed into real estate. Under a sound money standard these lines tracked closely, as they did for most of American history. Bitcoin is one candidate path back to houses priced for their use rather than their monetary premium.
The Pattern Is Global
If broken money were a US problem, the story would end here. It isn't. The same monetary forces that pushed American housing from ~3× income to ~5× have pushed every other major Anglophone market further. Bitcoin's argument is structural — and structural problems leave global fingerprints. The chart below tracks price-to-income across five major markets over the past two decades.
Home-Price-to-Income Ratios: Five Major Markets, 2005–2025
Median home price divided by median household income · every line started near "affordable" (3.0×) within living memory
Source: Demographia International Housing Affordability, annual editions 2006–2026 (each edition reports Q3 of the prior year). Hong Kong was first included in the 2011 edition (Q3 2010 data); earlier values are intentionally absent.
The US line (amber) is the most affordable of the five. Hong Kong peaked at 23.2× in 2021 — nearly eight times the "affordable" threshold, and roughly five times the US figure. Sydney and Vancouver spent most of the last decade above 10× income. Greater London, the steadiest of the climbers, hit an all-time high of 9.1× in 2024 before easing to 8.5× in 2025. In none of these markets was housing "affordable" in any year shown — and as late as 1990, per Demographia's own historical context, national price-to-income ratios sat at 3.0× or less across Australia, Canada, the UK, New Zealand, and the US. Every market on this chart has roughly tripled relative to income within a single working life.
The Tokyo counter-example: Japan provides the only major-market counterfactual. Tokyo housing peaked in 1990 at the apex of a famously speculative bubble, then deflated for roughly 15 years as the bubble unwound under a sustained credit contraction. Prices today sit far below the 1990 peak in real terms, and Tokyo's price-to-income ratio has been broadly stable for two decades — not rising along the global trajectory. The mechanism that produced this anomaly was painful (Japan's "lost decades"), but it shows the ratio can revert: when housing's monetary premium was forced out, the ratio came down and stayed down. The bitcoin thesis is that a similar outcome could come without a crash, by the premium moving into a different asset rather than being wrung out of property. That has not been tested.
Where this leads: The US is the most affordable market in this comparison set. The bitcoin thesis isn't that American housing is uniquely overpriced; it's that global housing carries a large monetary premium, and that if part of it moved into a scarce, portable asset, price-to-income ratios would move back toward shelter value. The next tab looks at the evidence so far.
Your Home Has Been Deflating
measured in the new sound money standard
You think your house appreciated. In dollar terms, it did. Price the same house in bitcoin, a money with a fixed supply, and the picture inverts: since 2013 the house has fallen steeply. Two readings fit the chart. On this page's reading, the house isn't getting more valuable; the dollar is getting weaker. The other reading is that bitcoin rose as it was adopted. Both are part of the story.
367
BTC for a House · 2013
74
BTC for a House · 2017
~5
BTC for a House · 2025
?
BTC for a House · 2030
BTC Required to Buy the Median US House
Annual average bitcoin price vs. the median price of new houses sold · 2013–2025, with projected trend to 2032
Sources: FRED (MSPUS), CoinGecko, CoinMarketCap — annual averages. Projected trend based on historical trajectory; not a price prediction.
Yes, the line is volatile, because bitcoin is volatile. But look at the direction. In 2013, you needed 367 bitcoin to buy the median US house. By 2025, you needed roughly 5. That's a 98.6% decline in the bitcoin-denominated cost of housing. Dollar appreciation in home values doesn't change what this chart shows. The page's reading is that the house is demonetizing, shedding its store-of-value premium as bitcoin takes on a monetary role. The dashed line extends the past trend; it is not a forecast, and the path has been jagged.
What If You Had Bought Bitcoin Instead?
$60,000 — used as a down payment vs. invested in bitcoin. Two very different realities.
Based on $60,000 at each year's average BTC price, valued at 2025 BTC price of $88,000 vs. 2025 median home of $416,900. Mortgage assumes 20% down, 30-year fixed at prevailing rate.
The Real Opportunity Cost of Buying a House
Growth of $1 invested in 2018 — bitcoin vs. housing (log scale)
Start year:
Housing: S&P Cotality Case-Shiller U.S. National Home Price Index (FRED), annual averages; it follows the same homes over time. Bitcoin: annual average price. Sources: FRED, CoinGecko.
It's Not Just Since 2013
Bitcoin against housing from five starting years, each held to 2025 (price return only, before rent and ownership costs; housing by the Case-Shiller National index)
All rows end at 2025 prices — populated at runtime.
The structural argument: On this page's reading, real estate is the largest store of fiat money's missing value: trillions sitting in walls, roofs and land, beyond their use value, because the currency doesn't hold value on its own. Bitcoin is a possible counterforce. If it keeps monetizing, housing could demonetize back toward utility value; under sound money, houses cost 2–3× income. Whether that happens, and how fast, is the open question.
Tax on a saleUnited States · married filing jointly · 24% bracket · Typical / average (~5%)
?Off by default: most households take the standard deduction ($32,200 filing jointly in 2026), and then mortgage interest saves no tax. Turn it on if you itemize. The owner then saves the interest times your federal bracket plus the state rate, on up to $750,000 of loan (IRS Publication 936), and the renter invests that much less each month. It overstates the saving for anyone close to the standard deduction.
Simplified 2026 federal rules and one rate per state; not tax advice. A CPA can run your actual numbers.
What If You Postponed the House Purchase?
The conventional wisdom says: buy a house as soon as you can. Lock in a mortgage. Build equity. But what if you took the money you would have used as a down payment and bought bitcoin instead? Pick a start year to see whether, by today, the bitcoin path would have bought the house outright, with no mortgage. This is not investment advice, and past bitcoin returns are not a forecast.
Buying bitcoin is not "missing out on a house." It is a postponed house purchase — one where you might buy the same house for a fraction of its current bitcoin cost, potentially outright, without a thirty-year mortgage. The question is not whether you want a house. The question is whether you want a mortgage.
Home price defaults to the start year's median price of a new house. Rent defaults to market rent for that price in the start year (Zillow's price-to-rent ratio); your own rent means your rent in July of the start year. Either way it resets each July with Zillow's market rents. The rate defaults to the year's average 30-year fixed rate, and the down payment to 20%. Your home's value follows the Case-Shiller National index. Your own values may differ: enter them to override.
?On (the like-for-like case): both households spent the same every month. The owner paid the mortgage, property tax, insurance and maintenance; the renter paid rent and bought bitcoin with what was left, or sold bitcoin to cover rent when rent cost more. Off: only the up-front sum goes into bitcoin, and the monthly difference is spent, or paid from income when rent cost more. The off setting tests the objection that a mortgage forces saving and renters don’t save.
Wealth over time (if sold that year, after tax)
If sold, after tax (the default) sells both in each year, as the cards value the end: the house after selling costs, the loan and any tax above the home-sale exclusion; the bitcoin after its sale cost and the tax on its gain. Held is before any sale: the house’s equity and the bitcoin’s value. The heaviest, light line is the difference, bitcoin minus the house: above zero, bitcoin is ahead.
How this works: The house is bought in July of the start year at that year’s median price for a new house (Census/HUD). The renter puts the buyer’s up-front cash (down payment plus 1.04% closing costs) into bitcoin at the start year’s average price. Every month since, through this month, the owner has paid the mortgage (if there is one), property tax (0.9% of the home’s value a year), insurance ($2,490 a year per $400,000 of value) and maintenance (1%); the renter has paid rent and invested the difference, or sold bitcoin when rent cost more, at the price each month opened at. The house’s value follows the S&P Cotality Case-Shiller U.S. National index, which tracks the same homes over time, to its latest published month; tax, insurance and maintenance follow that value, reset each July. Rent starts at market rent for the house (Zillow’s typical home value over its rent index, for the start year; a 2014 start uses CPI rent, since Zillow’s index begins in 2015) and resets each July with Zillow’s market rent index. The cost rates are today’s defaults, applied to every year. Results are shown if sold today, after tax (set in Tax on a sale, above the calculator), with the before-tax figure beside each: the house less 6.6% selling costs, the loan and the tax on any gain above the home-sale exclusion; bitcoin at today’s price less its 0.5% sale cost and the tax on its gain over what was paid, including coins sold along the way. Monthly amounts and totals are in the dollars of the day.
The mortgage is often described as "leverage" — and it is. A 20% down payment — the conventional case — gives you 5:1 exposure to house price appreciation. But leverage has a cost. Over 30 years at typical rates, you pay roughly double the purchase price in total — the house plus the interest. Add property taxes (which never stop), insurance, and maintenance, and the all-in cost of ownership runs well above the price (The Ceiling tab adds it up). Priced in bitcoin, that asset has been deflating. Holding bitcoin involves no leverage, interest, property tax or maintenance. Its costs are volatility and custody, and you still pay rent.
What Might Happen Going Forward?
The retrospective calculator above shows what did happen when you chose bitcoin over a house. This calculator asks the same question forward: what does the Power Law model suggest happens from here? Enter your own assumptions and compare. The projection is built on the Power Law growth model; market behavior may diverge.
This calculator uses the Power Law model as its bitcoin price assumption. The Power Law is an empirical observation with a 95%+ R² fit, not a guarantee. This is not investment advice.
Both households pay the same: the buyer’s up-front cash goes into bitcoin for the renter, and each month the renter matches the owner’s costs with rent plus bitcoin (details under the results). Prices, rates, rent and costs are nominal, as quoted; inflation only converts the results to today’s dollars in the Real view. Both paths run the same horizon from today.
Baseline assumptionshome prices 4.68% a year nominal (since 2000) · Real view deflated at 6.5% (M2 growth)
Home appreciation (nominal / yr)?How fast home prices rise, in nominal terms, the way house prices and mortgage rates are quoted. The presets are the recorded US rate to 2025: Since 2000 4.68% a year (S&P Cotality Case-Shiller National; the default, and the highest of the three windows), Since 1990 4.23%, and Long run 3.41% (Shiller’s series from 1890, chained to Case-Shiller). A national index: your market can differ. When inflation runs higher, home prices tend to rise in nominal terms while a fixed-rate loan balance doesn’t. That is the fixed-rate borrower’s inflation benefit. To model a higher-inflation future, raise nominal appreciation. The same setting drives Bitcoin vs. Rental Property.
Deflator for the Real view (% / yr)?The inflation rate the Real view uses to turn future dollars into today’s. It divides both paths by the same factor, so it never changes which one comes out ahead. CPI (3.5%) is about the long-run official rate; M2 growth (6.5%), the site’s default, is about the 50-year growth of the money supply; Shadow Stats (8%) follows John Williams’s reconstruction of the pre-1980 CPI method, which is disputed. It is the sitewide setting: changing it here changes it on Bitcoin vs. Rental Property, The Half-Life and every other calculator that uses it.
The mortgage
Rent
The owner’s costs
Selling and trading
Display values in:?Real shows each year’s dollars in today’s purchasing power: divided by the deflator named below, compounded to that year. Nominal shows the future dollars themselves, with nothing taken off for inflation. Both paths are divided by the same factor each year, so switching never changes which one is ahead. Money paid or received along the way is nominal in both views, as paid.
Showing Real values: today’s dollars, deflated at 6.5% a year (M2 growth). At that rate, $100,000 ten years from now buys what $53,273 buys today, so Real shows $53,273 where Nominal shows $100,000.
?On (the like-for-like case): both households spend the same every month. The owner pays the mortgage, property tax, insurance and maintenance; the renter pays rent and buys bitcoin with what’s left, or sells bitcoin to cover rent when rent costs more. Off: only the up-front sum goes into bitcoin, and the monthly difference is spent, or paid from income when rent costs more. The off setting tests the objection that a mortgage forces saving and renters don’t save.
Wealth over time (if sold that year, after tax)
If sold, after tax (the default) sells both in each year, as the cards value the end: the house after selling costs, the loan and any tax above the home-sale exclusion; the bitcoin after its sale cost and the tax on its gain. Held is before any sale: the house’s equity and the bitcoin’s value. The heaviest, light line is the difference, bitcoin minus the house: above zero, bitcoin is ahead. The Drifts to the floor scenario’s bitcoin is drawn faintly, whichever scenario you pick.
How this works: The bitcoin projection uses the Power Law model (Porkopolis coefficients). Home appreciation is nominal, like the mortgage rate: the default is the recorded US rate since 2000 (Case-Shiller National, 4.68% a year to 2025), with since-1990 and long-run presets in Baseline assumptions. Mortgage assumes your chosen down payment (default 20%), 30-year fixed. Both paths run the same number of years from today. Equal cash out: the renter puts the buyer’s up-front cash (down payment plus closing costs) into bitcoin, then each month pays rent and invests the owner’s cost minus rent, or sells bitcoin when rent costs more; the owner’s cost is the mortgage payment plus property tax (0.9%), insurance and maintenance (1%), the last three following the home’s value. Rent defaults to market rent for the price (Zillow’s price-to-rent ratio, 15.77) and grows with home prices. Bitcoin’s price moves month by month from today’s multiple of the Power Law trend to the scenario’s target at the horizon; the default, Today’s gap persists, keeps today’s multiple, so no reversion to trend is assumed. Each purchase and sale pays 0.5%. Results are shown if sold, after tax (set in Tax on a sale, above the calculator), with the before-tax figure beside each: the house less 6.6% selling costs, the loan and the tax on any gain above the home-sale exclusion; bitcoin less its 0.5% sale cost and the tax on its gain over what was paid, including coins sold along the way. Every default is in Baseline assumptions, with its source. Projected dollar amounts render in your chosen frame — Real (today’s purchasing power) or Nominal (future dollars) — via the toggle above the results. Every end value is divided by the same inflation factor in the Real view, so it never changes which path is ahead. Monthly amounts and totals are shown nominal, as paid.
Figures throughout are in USD. Reading from outside the US? Read why →
Run this on the other side → Bitcoin vs. Rental Property, the landlord’s version of the decision, opens with your horizon, bitcoin scenario, home appreciation, sale costs, Real or Nominal view, and tax regime, bracket and state.
Share this scenarioA link that carries your current calculator inputs — for sending a specific comparison to a friend, your spouse, or your advisor.
Share the pageA clean link to the calculator — without your specific inputs — for public posts and broader sharing.
If house prices keep rising relative to incomes, at some point people simply cannot afford the monthly payment — regardless of interest rates, loan terms, or creative financing. This ratio has a structural ceiling, and we may be approaching it. Bitcoin has no payment-to-income ceiling of this kind: its supply is fixed and its adoption is still early, though its price can fall as well as rise.
$1,100
Avg Mortgage Payment · 2015
21% of income
$1,500
Avg Mortgage Payment · 2020
27% of income
$2,200
Avg Mortgage Payment · 2025
32% of income
The Ceiling Has Already Been Breached
Monthly mortgage payment as % of median household income · 2013–2025, with threshold lines
Sources: FRED (MSPUS, MORTGAGE30US), Census Bureau — assumes 20% down, 30-year fixed at prevailing rate
A household spending more than 30% of gross income on housing is considered "cost-burdened" by the US Department of Housing and Urban Development. A median-income household buying the median-priced home today would be at or beyond this threshold. After accounting for taxes, insurance, and maintenance, the true burden is even higher. Something has to give: prices fall, incomes rise faster than prices, rates fall, or housing sheds part of its store-of-value premium. The last is the path this page argues bitcoin makes possible; the others remain possible too.
The True Cost of Homeownership
Purchase price vs. total all-in cost — by year of purchase
Calculated using median home price at year of purchase, prevailing 30-year fixed rate, 20% down, 1.2% annual property tax, ~$150/mo insurance, 1% annual maintenance
The hidden cost of "building equity": On a $417,000 house purchased in 2025 at 6.8% interest with 20% down, the total cost over 30 years — including interest, property taxes, insurance, and maintenance — exceeds $1 million, much of it interest. Under a sound money standard, houses were bought with savings. This page's argument is that bitcoin could make that possible again.
Data sources: Federal Reserve Bank of St. Louis (FRED), U.S. Census Bureau, Bureau of Labor Statistics, Shiller Home Price Index, CoinGecko, CoinMarketCap.
This page presents structural monetary observations, not investment advice. Historical data does not guarantee future outcomes.
Common questions
Is bitcoin a better investment than real estate?
Looking back, the retrospective calculator shows which path came out ahead for each start year it covers, measured to today; the answer depends on the start year and on today's bitcoin price, and the calculator shows the numbers for each one. Looking forward is a different question, which the projection mode treats under stated assumptions rather than as a verdict. Both views show their work.
Should I buy a house or buy bitcoin?
This page will not answer that for you — housing is shelter as well as an asset, and the comparison includes mortgage leverage, maintenance, taxes, and the value of living in what you own. What it will do is put real numbers on the tradeoff you would otherwise make on instinct.
Does real estate hold its value better than bitcoin?
Real estate is less volatile year to year; over the long span the comparison inverts. The page shows both facts rather than choosing one — volatility and long-run purchasing power are different questions, and conflating them is how most of this debate goes wrong.
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