Bitcoin has outperformed both Australia’s housing market and stock market over the past decade. Picture: istock

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While buying and selling property proved to be a smart investment decision during the pandemic, owning Bitcoin could’ve been a better choice.

New data obtained by Ray White looked at the best investments for buyers to make over the past decade; comparing asset classes and ranking them on their capacity to build wealth.

The research found the cryptocurrency to be the best performer over the last 10 years, rising by close to 160,000 per cent.

Sydney’s median house prices as an asset class have grown by 236.8 per cent over the last decade. Picture: NCA NewsWire / David Swift

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While Bitcoin has been seen as a high-risk investment in recent months as the crypto market has underperformed, a buyer who purchased it in 2012 would still be reaping the benefits.

Sydney house prices came in second place, growing by 237 per cent over the same time frame.

Hobart and Canberra both experienced high levels of growth over 200 per cent, with the NASDAQ narrowly beating out Sydney’s market.
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According to Ray White chief economist Nerida Conisbee, property investing’s role in supplying rental properties means tax incentives are in place.

“Consider if you bought in Sydney 10 years ago, you would be paying less on your mortgage now for a home that’s worth double than what you paid for it. If you rented, you would be paying $9,360 more per year for a home that you hold no equity in,” Ms Conisbee said.

Over the past decade, Bitcoin has increased in value by 158,846 per cent.

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“Buying a first home is important, not just to get on the property ladder but also because being a renter at retirement means that you are much more likely to be living in poverty. It’s also the case that being a renter makes you much more susceptible to market fluctuations.”The data also looked at the worst performing asset classes over the past 10 years, with term deposits and Treasury bonds.

Ms Conisbee noted that, as opposed to Bitcoin, they were considered the most risk-free investments but brought in diminishing returns at 12.7 per cent in the data’s time frame.

Leverage was the main reason for this, as most asset classes didn’t require any debt to be used.

Hobart’s market was the second highest performing housing market in the country, rising by 220.7 per cent. Picture: ERA planning and environment

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“Once purchased, the family home is a tax free asset in most of Australia. Buying a family home, instead of renting and investing in other asset classes can mean much less tax is paid over time.”

“Holding a property for the long term is always the best strategy to build wealth. Even if you buy at the absolute peak of the market, keeping a property for a long time means that it barely matters.”

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