How to make money acquiring a house that the bank paid for:

[Anonymous No.419035]

I'm tired of seeing people posting that "mortgages are just the bank fucking you" and "getting in debt ever is retarded" and all this shit.
Here's how to own a house and make more money with the bank's money than the bank is making.

Find a decent vacant lot for ~$50k. There are lots around if you look online in your area, it doesn't have to be huge but the more you can get over a half acre, the better.
Now the bank will fund you to build a house on that lot, it's called a builder's mortgage. They give you money in increments based on what the final value of the house/lot will be. They have no problem with lending you $200k to build a house that would sell for $300k.
Their first payment has the cover the cost of the lot AND get your house to 40% completion, though, which is where most people struggle to get through. You'll probably need to borrow some money to get through this part, but don't worry, you'll get it back once the build is done. They are giving you the FULL cost to build the house in full, they're just lame about the increments they give it to you in, in order to cover their ass. They don't want to give you the first payment and have you go to Vegas and blow it, and all they can take from you is a vacant lot that isn't worth what they've given you already.


Build a decent house. As in, don't build a piece of shit. Spend some time looking at floorplans and decide on what you're able to afford square footage wise. I just recently built a 1750sq ft home with a fully finished basement for ~$230k. The monthly payment on our mortgage is ~$1150. Make sure your building contractor is including the price of a fully finished basement in the total cost. Two bedrooms, kitchen, bathroom, laundry room in the basement, and there are two sets of stairs to access the basement. One is from the garage, one is inside.

[Anonymous No.419036]

Complete the house, and rent the basement out to either a couple or two separate people.
Price the rooms comparatively to what a dorm room costs at your nearest college/university if you're near one, and if you're not, make sure it's priced comparatively to other rented properties in your area. If shitty ass two bedroom apartments that are small in an apartment complex are being rented for $1000/mth, you can get more than that easily. You are offering a brand new, clean, never been lived in, LARGE two bedroom apartment.

Now, use their rent to pay your mortage off. Where I am, shitty fuckin dorm rooms are rented for around $600/mth. That makes renting the basement to two students EASY for $1200/mth, because it's the same price as a dorm but a hell of a lot nicer. We're close to a university, so that allows us to be a bit more choosy with who we want living there as well.

With the mortgage being $1150/mth and rent coming in at $1200/mth, any amount of money you are able to save is able to be chopped right off of your mortgage. My fiance and I budgeted ourselves around $1100/mth, so I know we are comfortable with giving that up. So we put that on top of the rent, and the mortgage gets paid of way faster.

By renting the basement out and also holding ourselves responsible for "paying" the mortgage ourselves as well, we are able to pay off a shitpile of the mortgage over the course of two years. The interest in the first year was around $6500, and we're aiming to pay off close to $28k. The second year we'll pay off a similar amount, but the interest will be less.

[Anonymous No.419038]

In two years time, we'll be able to sell a house that we initially paid $230k for, and have the mortgage paid down to ~$190k, for $280k+. Where I live, it's pretty common knowledge that building is cheaper than buying, and that you can build a 1600sq ft house for ~$200k, depending on how nice of a house you build.

That's $90k in our pockets, but we paid ~$55k into the mortgage on that. Now, we could have done that right off the hop (sold it), but the house value is still pretty much "brand new" after two years. Also, if you don't live in the house for at least a year (I think) you get taxed on all that. So you might as well live in the new house you just designed and built for a couple years.

So basically you start with fuck all, nothing, and go to SAVING ~$50k over the course of two years for living in a new house and renting the basement. You don't even have to sell it, if you stay there and continue doing that, you'll have the mortgage paid off in EIGHT YEARS. The bank gave you the money hoping it'd take 25.
Now, you don't have to pay the mortgage off that fast. If you're okay with giving the bank way more in interest, you can have your tenants pay the mortgage for you forever. You're still on the hook for property tax and utilities and all that, but not having a mortgage in a brand new house is pretty sweet.

[Anonymous No.419041]

Here's the numbers because I know people will try to say that it's bullshit. You need to make enough money in order to support an $1,100 mortgage payment, that's it. If you can make the mortgage payment, the bank is happy to give you the money and rape you on interest over many years.
Those of you paying rent probably pay close to that already.
My bank is CIBC so I used their mortgage calculator for reference.2.79% on a two year fixed rate. Using a 10 year fixed rate has a similar outcome but it takes an extra year to pay it all off.
https://www.cibc.com/ca/mortgages/calculator/mortgage-payment.htm
>First year
$230,000 + $6417 interest = $236,417 owed
Payment is $1,064/mth = $12,768 per year
1200 in rent x 12 months = $14,400 per year
You are paying $1,100 per month = $13,200 per year
So you're paying off $27600 total minus the interest per year

Which means, after the first year, you owe $208,319
>2nd $208,319
>3rd $186,028
>4th $163,112
>5th $139,551
>6th $115,329

So now you've lived in your house for five years. The bank will make ~$3200 off of you in interest the following year.

>7th $90,426
>8th $64,823
>9th $38,501
>10th $11,440

And obviously the entire mortgage is paid off in the 10th year.

[Anonymous No.419045]

So, to round this all up, the bank lent you $230,000 with the intent of you taking 25 fucking years to pay it off. This amounts to them raping you in interest because you took so damn long to pay it.

You paid the entire thing off in 10 years, and you were under zero pressure the entire time because, if something were to happen in that time and you were in need of money, your mortgage for that month was already paid regardless. You don't even have to be frugal with your savings, this is assuming that you're holding yourself obligated to pay for your own mortgage and that's IT.

Now, you own a house that costed $230,000 to build.
The bank made ~$34,480 in interest.
(Interest paid, in order of 1st year to last: $6400, $5800, $5100, $4500, $3800, $3200, $2500, $1800, $1070, $310)
You own a house that can be sold for $280,000+ easily, and now you are making $1200/mth right into your pocket if you don't want to kick your tenants out and take the basement back for yourself.

You borrowed money from the bank... and you made a lot more money with it than the bank did, as well as got yourself a new house to live in, and worry-free mortgage payments for a decade. Oh, and you own a house in 10 years, and that's by holding yourself to the bare minimum of paying your own mortgage and having tenants. If you can save more than that, you could have it paid off faster.

[Anonymous No.419062]

And the thread begins its plummet.

[Anonymous No.419072]

too long didnt read lol

[Anonymous No.419079]

>>419072
come on dont be a fuck

[Anonymous No.419094]

You'd think 2008 was 100 years ago based on how this thread reads.

[Anonymous No.419103]

It's an interesting idea but far too much risk to shoulder for a single investor.

It might be a neat project once I've already hit my retirement goals (~800k portfolio).

[Anonymous No.419124]

Or you buy a rental property at 10% down ~%20 under market value, charge the tenants just enough to pay the mortgage, maybe ~$100 more. Two years later buy another rental property %10 down %20 under market value. Repeat every two years, gain equity in the properties via tenants for X years. Your only investment is the down payments + maintenance. Within 10 years, your net worth will be 1,000,000+. By 15 years you start owning these properties completely, based on appreciation you can sell or make %100 profit off of tenants. If the market waivers sell your properties, have several million in cash outright and create low risk portfolio. Begin buying commercial properties and multi unit apartment buildings, fix up foreclosures for quick flips, accrue 50 million+ net worth over a total of 30 years.

[Anonymous No.419131]

>>419124

Yeah you're right, you can dedicate your entire life's efforts to being a landlord for a few dozen lowlifes who never pay their rent on time in order to make a lot of money, as well as maintain several different properties, all of which are not new in the slightest. If you're buying at 20% under market value, they're probably already in need of repairs.
Sounds like a great time.

[Anonymous No.419136]

>>419094

Seeing as how this is a board specified around the discussion of making money, and in 2008 fucking everyone lost money, you could copy your post into every thread on this board and have it taken in the exact same context.

>omg guys investing money?!
>so stupid its like 2008 didnt even happen with you guys

[Anonymous No.419137]

>>419131

>what is property management
>what is an acquisition model
>what is tenant acquisition model
>what is time tested and proven buying/selling/flipping strategies
>what is team development

Do you understand that real estate is still one of the most popular ways to gain wealth? Especially in the current market?

[Anonymous No.419142]

>>419137
>Do you understand that real estate is still one of the most popular ways to gain wealth? Especially in the current market?

Do you understand that you are comparing a FULL TIME CAREER with a strategy on how to make money while acquiring a house with a builder's mortgage?
Do you understand that professional athletes make way more than you do in real estate bud?
Why not just design an original OS that becomes a giant fad like Steve Jobs did? I mean, why not, right? lol you fucking idiot

>guys, here is how to borrow money on a mortgage and make money from it

>NO, DO THIS FULL TIME CAREER INSTEAD, YOU GET MORE MONEY

[Anonymous No.419154]

Sounds solid man
Thanks
Money here i come !

[Anonymous No.419159]

>>419124

Do you read biggerpockets, by chance?

[Anonymous No.419176]

>>419035
This is actually pretty sound advice

Thanks for sharing OP

[Anonymous No.419188]

>>419045
>>419041
>>419038
>>419036
>>419035
Thank you for posting this.

I definitely prefer the idea of investing in property to equities because:
- you can rent spare rooms out
- easy to use leverage and less risky
- save money you would pay in rent (other side of the coin is interest payments of course)
- plus I think that luck plays a much higher role in picking stocks than most investors think because http://www.forbes.com/sites/rickferri/2012/10/11/indexes-beat-active-funds-again-in-sp-study/

I am the guy with the blog. Please read:
https://millionairein7years.wordpress.com/

[Anonymous No.419199]

>----TLDR SUMMARY----
>GO INTO DEBT TO BUY REAL ESTATE
>IT CAN'T POSSIBLY GO DOWN IN VALUE LEAVING YOU UPSIDE ON A MORTGAGE!

Damn niggers, was 2009 really that long ago?

>P.S. THE BANK CAN JUST SELL THE MORTGAGE TO SOMEONE ELSE AND EVERYONE MAKES MONIES!!!!

[Anonymous No.419223]

>>419124

So many implications.

>implying you will consistently get houses 20% under market
>implying you will constantly have renters and they wont be scum
>implying you will time the market and not be stuck with all these houses in the next bust

[Anonymous No.419229]

>>419035

Any thoughts on how this would apply to non-US countries, OP? I live in Bongistan.

[Anonymous No.419233]

>>419199
2009 was 5 years ago, people who were in middle school then are in college now, it's a long time.

[Anonymous No.419255]

>>419137
This guy gets it. Other poster is a moron. Hurr durr what is EFFORT FAGGOT?

[Anonymous No.419258]

>>419255
This users on this board are all here to find quick get rich schemes that take little skill or effort, they are not here to read about something that would take actual work.

[Anonymous No.419260]

>>419142
You only mentioned one property. Do the same rental scheme with one property and it's the same thing. A strategy which relies on selling a home instead of using it as a rental property is more risky. You're assuming it would be easy to sell it and that the market will be where you want it to be. The rental structure doesn't rely on the value or state of real estate market. If you are in a good area and there's a downturn, there will always be people renting. Idk why you are getting upset.

[Anonymous No.419277]

How about taxes from rent? In my country you need to pay 30% tax from rent profits.

Rent 1000
Maintnance costs -200
Interest eg. -200
600 Left - 30%
420
Rest if mortgage eg. -500

-80

[Anonymous No.419322]

>>419277

This. People think renting is pure profit. You are responsible for everything. You are still paying a mortgage with interest. And then you have taxes.

[Anonymous No.419325]

>>419229
I honestly don't think it could be that different than it is here in Canada, but the process could have some more hoops to jump through. I don't really know.

>>419255
>This guy gets it. Other poster is a moron. Hurr durr what is EFFORT FAGGOT?
Do you seriously not understand why a "financial tip in regards to buying a house" is not comparable to "an entire fucking career" in terms of profit?
>>419258
It's fucking far from a get rich quick scheme bud, clearly this entire thread was designed to inform people that didn't know about this method of acquiring a house for less.
>>419260
>If you are in a good area and there's a downturn, there will always be people renting.
Oh, so if the market takes a turn you would be able to keep renting out the basement then? So if you wanted to sell the house for a profit but you couldn't because there was a big downtown, you'd be able to continue profiting just by continuing to do what you had been doing all along?

[Anonymous No.419336]

>>419277
>>419322

It's so painfully obvious when a poster that doesn't have a shred of knowledge in regards to actual property maintenance and repairs tries to imply shit like this.
$200 a month for maintenance on a new house? top lel bud seriously, have you guys ever touched a wrench in your lives?

>You are still paying a mortgage with interest.
Did you miss the post where I listed all the values of how much you owed year to year and then the one that showed how much interest there was in every year in the post right after it?

[SVM !KSdlFS2kHA No.419360]

>>419188
is that pic for real? houses were really that cheap?

[Anonymous No.419367]

>>419035
I like the idea OP.

I was looking into duplex/triplex purchases as an investment, but this might be an easier way (in the long run) to acquire serious real estate capital.

You didn't mention too much of the process at the beginning, how long did it take to get the right contractor/location? What were the hiccups in the building process? I can't imagine it was all sunshine and butterflies.

[Anonymous No.419369]

>>419035

OP pretty genius.

but I see how this can work in a place like america but not so much in a place like the netherlands. perhaps I am wrong.

[Anonymous No.419393]

>>419367
>You didn't mention too much of the process at the beginning, how long did it take to get the right contractor/location? What were the hiccups in the building process? I can't imagine it was all sunshine and butterflies.

I'm in a trade myself so I have a fairly good idea of what goes into building a house. I've seen many commercial buildings built from the ground up and worked inside them the entire time and get to see it all come together, so I guess that's a pretty big advantage to the whole idea.
Oh, and a good friend of mine builds houses for a living. So there's that too.

Finding the location took a few months. There were a few other lots that were further away from the city, and there were also a few right inside the city that didn't quite meet all of the requirements we had. Most were just way overpriced and they are all still for sale. We also wanted to be able to say fuck it to the renting and just live in that house and start a family if we wanted to, so we kinda had to make sure we didn't hate the lot/location before we decided. If you're intend is to sell, period, you don't have to worry about that.

I bought the lot in a private sale, so there was no agent involved.

As far as the building process, the biggest hiccup was actually deciding on a floor plan. I'm not expert on house design but I'm very able to picture how a floorplan will look in person due to looking at drawings at work a lot, and the contractor (again, a good buddy of mine) and I were butting heads a lot because he wanted to build a house 100% for resale, and I wanted to build a house that I didn't hate.
The whole "big giant kitchen, open-concept-everything" is big and attractive, but I don't really like the idea of my potential long term home being a big open fuckin box on the inside.
So he constantly wanted more floorspace in the kitchen, and I constantly wanted more floorspace in the den and living room where I'm going to spend most of my time.

Shit like that really.

[Anonymous No.419397]

>>419136
2008 was specifically about housing. People bought houses they couldn't afford, the banks thought it was okay because the house prices would remain the same and they could resell them easily and still profit.

Your scheme of build to lease to sell will die in negative equity unless you have capital from elsewhere.

[Anonymous No.419398]

>>419367
>-cont
The cost of lots around here vary quite a bit. You can buy a "good lot" right in the city that would easily make money if you're willing to live there. I've lived in the country my whole life so I was more partial to having more land, which made the process a lot harder. Most people won't have a problem with that part at all, I wouldn't think.

So the bank gives you your first draw, which has to get the house to 40% complete, which means windows and doors are all in and the roof is done. Basically the house is "sealed in". It also has to pay off the cost of lot, if you still owe on it.
Our second draw came at 65%, which basically just meant that the plumbing, electrical and furnace/duct work had to be roughed in. So the drywall isn't up yet and everything is still open.
The next draw was 85%, which is flooring done, drywall up and painted, and doors and fixtures hung, if I'm not mistaken. The last draw was 100% which meant total occupancy and everything completed.

[SVM !KSdlFS2kHA No.419415]

>>419398
>If you have a friend that knows about construction and helps with everything

Well thats a very big IF, most people will need to hire a company that builds the house for you. And the overhead is likely a lot

[Anonymous No.419420]

>>419398
So you paid for the lot prior to getting a bank loan, or the first draw took care of the lot? I haven't done tons of research, but lots in Phx AZ are fairly expensive. How much did you pay for your half acre?

[SVM !KSdlFS2kHA No.419425]

>>419398
Also you cant rent to an individual in an area that is residential only for families. So your plan will only work in areas that renting to individuals is allowed

[Anonymous No.419428]

>>419425
In the US none of these rules apply anywhere.

[SVM !KSdlFS2kHA No.419430]

>>419428
I personally experienced one of those cases. Me and my buddies wanted to rent a house and everything was ready to go, then they told us that they only rent to families because of zoning restrictions. And I have heard from other people that this is pretty common around the US

[Anonymous No.419435]

>>419430
My city and state have no such regulations and I have never heard of that, in 10 years of living here and 2 years of working in construction and researching zoning ordinances.

[Anonymous No.419472]

>>419420

I paid for the lot with my own money, prior to getting the builder's mortgage. It's a three acre lot 10 minutes out of the city, but 5 minutes away from a university. It was $99,000.

Around here, half acre lots are generally $40-$100k, depending on location mainly. A half acre lot in a great location is always worth more than a 0.75 acre lot in a shittier location.

>>419415
>Well thats a very big IF, most people will need to hire a company that builds the house for you. And the overhead is likely a lot
It's a big if but it's not necessary, it just helps. There's nothing wrong with hiring a company that builds houses to build your house, and they make around around $50k-$80k on a build, which will likely take three months, maybe a bit more depending on hold ups.

>>419430
>>419435
I've also never heard of this. What do you mean, you can only rent to families? You can't rent to two people that aren't related? That seems pretty stupid.

[Anonymous No.419481]

>>419035
who wants to build a qtr million dollar house all new and get some random renters in the basement?

i bought a house 4 years ago for 80k, paid in full. my only obligations are about 3500 a year in taxes, utilities, and general maintenance.

meanwhile the house has gone up in value since purchase and i slowly have improved nearly every room - all financially stress free. most of my income is banked/invested since i have no mortgage. in a few years ill sell my house and use that money with the money ive saved over the last 4 years to buy a home like you propose, but own in full and dont have to worry about any faggots down in my basement.

things are easy when you're patient and only spend money that you have.

[Anonymous No.419482]

>>419481
>i bought a house 4 years ago for 80k,

Congrats man, you've lived in a shitbox for four years. You are comparing a shitbox with a brand new custom built home. The main floor alone is 1750sq feet. So is the basement. It's brand fucking new.

>meanwhile the house has gone up in value since purchase and i slowly have improved nearly every room - all financially stress free
"Financially stress free"? Nigga you had to fix every damn room in the joint and you're implying that it's better than living in a new house with separate stairs for the couple living in the basement? Please dude lol

[Anonymous No.419484]

>>419482
>implications
the house is great. i only fixed it up because i enjoy doing that stuff. zillow shows my house is at 145k now, all the houses around me have sold for near that. how is this a bad thing?

>you're implying that it's better than living in a new house with separate stairs for the couple living in the basement?
you talk like someone that's never lived alone on their own property.

[Anonymous No.419486]

>>419484
>the house is great. i only fixed it up because i enjoy doing that stuff. zillow shows my house is at 145k now, all the houses around me have sold for near that. how is this a bad thing?

Well then you bought it as a bank foreclosure or some shit, don't even try to imply that buying a house paid in full for $80k is a common thing. I spent more than that on our lot and I paid in full too. And of course you only fixed it up because you enjoy that stuff...

>the house is great
>shows my house at 145k

>the house is great
>shows at 145k

>145k
>great
Is this like a single bedroom 1200sq ft house with a 20 foot back yard or something?
You know what, a lot of people are satisfied with less and I'm not bashing that at all. I lived at home in a basement apartment that I built for six years in order to save the dough to pay for the lot. I'm just saying, you're clearly either purposely misleading people on the actual quality of this so called great house, or you lucked out huge on foreclosure or something,

[Anonymous No.419500]

>>419486
purchased as a normal sale from a family of 5. market was worse back then and i trolled zillow day and night for months. how much did you throw away rent per month in an apartment? it costs me about 350/mo here for taxes and insurance. anything after that is invested in at my discretion.

i think youre missing the point though. its all about taking steps and living somewhere you can own and actually afford without the radical mortgage games and renters in the basement. on top of avoiding that, you can easily bank most of your income to use as purchasing power to a larger house in only a few years time.

[Anonymous No.419512]

>>419500
>how much did you throw away rent per month in an apartment?

It was an apartment that I personally built in my parents basement, so nothing.

>i think youre missing the point though. its all about taking steps and living somewhere you can own and actually afford without the radical mortgage games and renters in the basement. on top of avoiding that, you can easily bank most of your income to use as purchasing power to a larger house in only a few years time.
I don't think I'm missing the point at all. You're implying to someone with a gross family income of $130k/yr that a monthly mortgage of $1100/mth is not something that is within their means. I just don't really understand why you think that it's such a huge payment.

It's less than a lot of people pay in rent.

I could lose my job tomorrow and life off EI by myself in this house and still make the mortgage payments.

[Anonymous No.419526]

>>419512
>It was an apartment that I personally built in my parents basement, so nothing.
half of 4chan lives in their parents basement for free. i did the same, its how i saved up the money for my house. only difference is i bought a house that appreciated in value, and you bought an empty lot to build a rental house with money you dont have.

>You're implying to someone with a gross family income of $130k/yr that a monthly mortgage of $1100/mth is not something that is within their means.
everyone does it but that doesnt make it a good idea. most people with 1100/mth payments have those payments for 30 years and pay WAY more than the original purchase price.

[Anonymous No.419544]

>>419526
>>419526
>only difference is i bought a house that appreciated in value, and you bought an empty lot to build a rental house with money you dont have.
I still don't believe that you just happened across a three bedroom house that wasn't completely fucking beat for $80k. A family of five just decided to up and sell their perfectly good home for $80k, and you just happened to enjoy fixing up houses, and that's why you've done work on every single room, not because the house was desperately in need of work in every single room? Nah lol

So is it a 1200 sq ft house with a 20 foot backyard or what? Why is it only worth 145k now if it's "a great house" that you've been renovating every room of? The house appreciated in value because you worked on it FOR FOUR YEARS!

I would hope that it would have appreciated in value dude, you've probably done hundreds of hours of work to it. You've spent $14k on it in taxes and shit, and supposedly have spent zero on renovations, and that's fine. You've got $94k into the house.
But where is the rest of this cash coming from that takes you from the supposed $145k value to the $300k+ required to puchase a 1750sq ft custom home with a fully finished basement apartment on a three acre private country lot? Depending on where you're located, that could be priced a lot higher as well.

[Anonymous No.419557]

>>419430
That's wrong.
I have never heard of this rule.
Sometimes you have to be aware of made up urban rules and ordinances.

They probably just went back on their decision and didnt want to rent to you. Due to the fact that you and your buddies would be a liability to the property and accelerate wear and tear (Parting, drunk damage, doing stupid shit damage, inviting people over or having parties, etc.).

[Anonymous No.419562]

>>419557

it's honestly kind of funny that the guy thought that was an actual law

[Anonymous No.419565]

>>419544
It honestly sounds like you don't understand real estate at all.

A few people were receptive to your house building scheme, but you seem very defensive of your "1750sqft custom home with a fully finished basement apartment on a three acre private country lot".

If any of your story is true and you are happy with your house and decision to build a home, stop being so defensive and enjoy your home.

You got a mortgage from the bank to build your dream home, with a rental unit, to offset the payments. Perhaps not a bad strategy, but when the day comes that I decide to build my dream home. I will pay it off upfront and not have any strangers living in my house...but that's just me.

If you want to generate passive income through real estate there are tried and true methods, like this guy pointed out. >>419124

[Anonymous No.419574]

>>419565
>A few people were receptive to your house building scheme, but you seem very defensive of your "1750sqft custom home with a fully finished basement apartment on a three acre private country lot".

That's because I don't think that owning a house like that and it being paid off at ~30 years old without having inherited money or being given a high paying job is something that is seen very often. I'm proud of it. It's a rare accomplishment, for a middle class guy to have done that.
I'm defensive because, first of all, telling a bullshit lie such as "I bought a great house from a 5 person family for $80k" is offensive. No, there is something fishy about that story, you know it, I know it, everyone with half a fuckin brain knows it because you don't just buy a "great house" for $80k, period.

>Perhaps not a bad strategy, but when the day comes that I decide to build my dream home. I will pay it off upfront and not have any strangers living in my house...but that's just me.
That's fine. I appreciate the quality of living that comes with my strategy. To each his own.

>If you want to generate passive income through real estate
You kind of forgot the "paying off a nice custom house in full" thing. I'm not giving advice on how to make money through real estate. Like, fucking clearly. How on earth you guys read my posts specifically regarding a builders mortgage and thought the only thing I was trying to do was make money through real estate is beyond me.

If I wanted to have real estate as a job, I'd be in real estate bud. I'm not, I'm in trades, like I said. This is a way to acquire a nice custom house, while living in a new home the entire time, and make money at the same time. Take that for what it is.
>It honestly sounds like you don't understand real estate at all.
Care to explain?

[Anonymous No.419581]

>>419425
>>419428
>>419435
>>419557
>>419562

There are definitely areas of the country where zoning laws have been interpreted such that people who aren't related are excluded from renting a single-family home. Typically higher courts have struck these down when challenged, but that doesn't mean it doesn't happen.

[Anonymous No.419582]

I would pay $50k just to not deal with fucking renters

[Anonymous No.419612]

>>419574
You kind of forgot that all /biz/ cares about is making money, that's why this board exists.(aside from being a containment board for shitcoins)

Maybe this thread would have been better suited for /diy/ or another board focusing on building/homes?


What you aren't realizing is that the price of a "great(subjective) house" is dependent upon the country, location in said country, neighborhood, etc. Where I'm from, NJ, you couldn't buy an outhouse in the middle of a lake for 80k, but in the Southeast of the United States property is a lot cheaper. And nice homes can be purchased for 80k. Again "great" is very subjective. And also location, location, location....your 230k house would price differently depending on where it is.

So IMO there is no reason to beat up on the guy who bought a fixer upper, in a less expensive area. You had different real estate/life strategies, he essentially flipped a fixer upper, pocketed the income, and he did or will buy his dream home.

Also it is usually cheaper to customize a pre-existing house then it is to build from the foundation up.

>tl;dr /biz/ cares about making money, not building houses

[Anonymous No.419614]

>>419581
>who aren't related are excluded from renting a single-family home

Maybe if the person doing the renting tries to enforce it. It's certainly not something that is going to actually prevent the person from renting their house like that guy is implying though.

>>419582
I get that, too. We talked about it a lot. I definitely don't enjoy having to deal with renters, but honestly if it's two quiet university girls, it's not that bad. I don't rent to guys. Tell that to your patriarchy.

[Anonymous No.419626]

>>419612
>Maybe this thread would have been better suited for /diy/ or another board focusing on building/homes?
Well it's a good thing I'm not focused on maintaining optimum board focus to thread intent ratio, isn't it? You can make money doing this, plain and simple. That's why I posted it here.

And dude, I completely understand that "great" is subjective, which is why I asked multiple times for specifics on the house. Claiming that "it's better" to "just buy an $80k great house" is stupid, simply because of what you said. That's why I'm not saying "SUPER AMAZING, THE BEST FUCKIN HOUSE YOU'VE *EVER* SEEN!!!!!!!!". That's why I listed the specifics of the house, location, square footage, features, etc. You know, so that, people can like, understand? The words that I'm communicating to them?

>So IMO there is no reason to beat up on the guy who bought a fixer upper, in a less expensive area. You had different real estate/life strategies, he essentially flipped a fixer upper, pocketed the income, and he did or will buy his dream home.
Well, he didn't pocket the income as of now, because he's lived there for four years and plans on living there for another few, having worked on it the entire time. Newsflash, you can make money purchasing old beat ass cars and restoring them and selling them too! Fuck, I'm sure you could do it with broken xbox's, dirtbikes and lawnmowers too if you wanted.
All it takes is a bunch of hard work that few people are willing to do, which is the exact point. This is a low stress strategy on how to both acquire a home WITH a mortgage, and make money doing so. That's pretty unique. Not a lot of people even know that it's something that your average "working man" can do, which is why we're here discussing it dude.
And I beat up on him because he started his post with "who wants to...." in a sarcastic way while advocating living in, and working on, a beat ass broken old fuckin house in the hood for six plus years.

[Anonymous No.419637]

>>419614
>Maybe if the person doing the renting tries to enforce it. It's certainly not something that is going to actually prevent the person from renting their house like that guy is implying though.
That's probably true. I was just pointing it out, because I can understand how someone who grew up in an area where property owners frequently enforced it that way might not realize that it wasn't the norm (and probably isn't constitutional)

[Anonymous No.419667]

>>419574
>You kind of forgot the "paying off a nice custom house in full" thing. I'm not giving advice on how to make money through real estate. Like, fucking clearly. How on earth you guys read my posts specifically regarding a builders mortgage and thought the only thing I was trying to do was make money through real estate is beyond me.

>>419626
>Well it's a good thing I'm not focused on maintaining optimum board focus to thread intent ratio, isn't it? You can make money doing this, plain and simple. That's why I posted it here.

Stop contradicting yourself, is it about making money or not, fuck. Figure out what you are talking about.

The rest of that is honestly to hard to read xbox...dirtbikes....idk wtf you are talking about.

I'm done with this conversation, I wish you all the best with your home.

[Anonymous No.419697]

>real estate investment

OP is a retard, don't build a house right now.

There are tons of homes currently for below market value because homes are still being foreclosed and the banks want to sell em as quickly as possible. Buy a cheap home or two or three that's below value/in auction then fix them up a bit (and it only takes a very little) to increase their value. Then find the best tenants, renters, or even buyers possible to increase the value of the general area even further. You've been massive gains this way and you don't have to wait to build a house to get one. Just increasing the value of your home in of itself after the deal will net you serious money and sell sell sell. Essentially always follow the basic of finance, buy low and sell high.

[Anonymous No.419707]

>>419544
>>419574
it's a 2 bedroom ranch with a full finished basement, 2 car garage with finished loft above. i painted every room to my liking, redid the trim to new, and yanked the doors out for solid wood. that cost about a grand all said and done. the kitchen was 1990s and i am in the middle of redoing it not because it needed it, but because i actually want to do it. budget is 10k for that project and i am doing all the labor myself and in absolutely zero rush.

the house appreciated on zillow, but zillow doesnt know what i've done to the house. i would list it at more to be honest.

>But where is the rest of this cash coming from that takes you from the supposed $145k value to the $300k+ required to puchase a 1750sq ft custom home with a fully finished basement apartment on a three acre private country lot?
ive already told you, my obligations to live here are taxes, insurance, utilities, and very basic maintenance. its about 350 bucks a month absolute bare minimum to continue owning the house. because of this, a huge amount of my income is easily banked, which has added up to over 100k now over the last 4 years.

i still think youre missing my point and getting hung up on my current home and comparing it to a new 250k house. mine is simply a stepping stone to the same goal as you. im just getting there patiently using money i actually have, and when i sell this current home and pair it with the money ive been saving since i moved it, ill be able to get that 250k house on 3 acres without any renters, mortgage payments, or worry about losing the house. but then again, i could stay here for a couple more years and start looking at houses in the 3's.

[Anonymous No.419725]

>>419626
>Claiming that "it's better" to "just buy an $80k great house" is stupid,
its better to buy a home in full and patiently save up money for the next house instead of feed a mortgage or burn it on rent, or rely on renters to pay your mortgage. if i only had 20k 4 years ago instead of the 80k and worked at mcdonalds i would have bought a good condition trailer and used the same strategy to work up to a 50k house.

[Anonymous No.419736]

>>419725
>its better to buy a home in full and patiently save up money for the next house

And how long does that take? Because you don't have to save to get a builder's mortgage, and with the strategy I outlined, you can pay off a $230,000 home in less than ten years, and you get to live in that nice new custom home the entire time.
I wouldn't exactly call it "feeding a mortgage" when the bank is making a grand total of $32k on it.

[Anonymous No.419824]

Thanks for the idea OP, once I get a good paying job I might consider it for real. At the minute I have enough for a sizeable deposit but not enough for a house outright, and I don't have regular work so I probably wouldn't qualify for a loan (nor would I want to enter one without the security of a long term job).

Cheers

[Anonymous No.419844]

>>419736

Some people on here are just scared by the concept of credit, any credit at all, and truthfully I don't understand why.

Take the guy you're talking with, he rather live in some shit oversized tin can for however many years, then some busted ass shack that's falling apart in some ghetto shithole and squirrel away all the money to one day outright purchase a nice house outright. Great, fine. But why?

If you can generate such large sums of excess income that you can turn a 30 year mortgage into short term credit, it makes even less fucking sense to go through living in the shitholes. It's the people that *NEED* 30 years to pay off the mortgage that really shouldn't be getting them, if you can raise the cash to buy the house outright in 8 years, or whatever, why not do it today?

Mortgages rates are basically nothing, they're barely above inflation. It's gotta be worth something, to have that goal house now instead of a decade from now. I'm happy paying a pretty miniscule premium for that and I've never seen a sensible explanation as to why it's not worth skipping the majority of a decade spent in waiting.

[Anonymous No.419848]

>>419725
>used the same strategy to work up to a 50k house.

Do you even live in the US? Seriously, I wouldn't even touch a 100k property out in the boonies to rent, I would honestly have trouble sleeping at night knowing I'm forcing someone to actually pay me to live in such a shithole, never mind living in it myself. I can't even imagine what kind of craphole 50k or even 80k must buy if it's within 25 miles of a city. God damn, that shit must be missing supporting walls.

[Anonymous No.420033]

>>419844
Finally, someone gets exactly what I've been trying to get across. You don't have to work at this, at all. You're literally moving into a nice, big, new custom home, immediately.
Like I was saying before, your average middle class "working man" could do this easily. Not that it's all fun and games designing and building a house, but in my opinion, it's certainly better than moving into a house that is in need of repairs and working on it constantly.

>>419848
And this is why I thought there was something seriously fishy earlier. $80k for a house that didn't burn down last year? What the fuck. 800sq ft, box-shaped wartime bungalows in shitty parts of the town I live in are still listed for ~$120k.

[Anonymous No.420048]

y u no just flip a house

[Anonymous No.420068]

>>420048
inorite?

i mean these two guys do it on the w network every day and one of them is gay and cant even use tools and the episode is still only like half an hour long

cant be that bad

[Anonymous No.420150]

>>419397

OP isn't talking about blatantly uneconomic housing lots. The biggest losers in the 2008 crisis were overwhelmingly households that were built more than an hour's commute out from its closest commercial center. The financial crisis caused a panic in housing as a whole due to the widespread nature of the bad loans, causing a bunch of houses in otherwise economically promising locations to get foreclosed on and demolished.

[Anonymous No.420323]

>>419848
you can get a wwII small ranch for 50k. which is a better situation for a person working minumum wage at mcdonalds than living paycheck to paycheck trying to knock out rent.

>>420033
seeing that my neighbors have sold their houses in the 150s, and mine is in better condition than theirs, i guess its not really a 80k house, is it?

[Anonymous No.420395]

>>420323
>seeing that my neighbors have sold their houses in the 150s, and mine is in better condition than theirs, i guess its not really a 80k house, is it?

seeing as you've got $25,000+ into it now, I'd say it's more of a $105k house, no?

[Anonymous No.420407]

>>420395
something is only worth what someone is willing to pay for it.

[Anonymous No.420495]

>>420323
>seeing that my neighbors have sold their houses in the 150s, and mine is in better condition than theirs, i guess its not really a 80k house, is it?

Maybe, maybe not. Depends how much you put into it. You said you did some work (putting up interior supporting walls), but you never really broke out exactly how much you spent on materials/labor (inb4 but my time is worthless!).

You could just clear this up by giving us an address where you live. Then we can just see it was a normal real estate transactions a few years ago @80k with a rough valuation of 150k now.

[Anonymous No.420519]

>>420495
less than 10k into it thus far. it doesnt matter though, i could sell it tomorrow for 80 and have done nothing to the property. the same strategy still applies. it costs me VERY little a year to live here, and the value is held while i live here and easily save up money for the next home. all im suggesting itt is you can get to the same end result with virtually zero risk and spending less money.

[Anonymous No.420783]

>>419848
>I would honestly have trouble sleeping at night knowing I'm forcing someone to actually pay me to live in such a shithole, never mind living in it myself

This is a god-tier attitude IMO. I eventually want to have a rental property or two but I want to make them really nice and worthwhile. I've rented enough shitty places and had enough shit landlords in my time and really do not want to put anyone through that experience. So long as it's economically viable, anyway.

[Anonymous No.420794]

>>420519
>it doesnt matter though, i could sell it tomorrow for 80 and have done nothing to the property.

And have done nothing? Dude, that's why the guy said "inb4 but my time is worthless!". He was mocking your attitude of, like, implying that your time is worthless and everything.

>>420783
>This is a god-tier attitude IMO. I eventually want to have a rental property or two but I want to make them really nice and worthwhile.

I think of it as more of a quality of living standard. As in, there is a certain line that I personally know would just weigh on my brain too much to consider, and therefore I wouldn't want to force other people into that same situation. That would also weigh on my brain.

[Anonymous No.420810]

Buy an old house that is in decent shape, get full cost replacement insurance, the kind where they will pay to rebuild a house with the same number of rooms etc.

Begin repairs on house, fixing wiring and redoing the plaster/sheetrock etc

Go into basement, start soldering pipes, burn house to the ground in horrible accidental fire.

Insurance company pays for a brand new house to be built on the lot.

Sell house for profit.

[Anonymous No.420863]

>>420794
well yeah, i'm just exchanging risk for time. but its still less than 10 years to get up to 250k tier, and i never have any risk/liability/stress, and no reliance on building half my custom home for idiots living in my basement (half the living space).

when you want a 600k house will you build it all on leverage too and attach an apt complex to offset spending money you dont have?

[Anonymous No.420903]

>>420810
>>420863

it's like polar opposites

[Anonymous No.420918]

>Get Rich Quick: Average Joe Edition
>Leverage yourself to the fucking moon
>Hope the contractor doesn't fuck up the construction
>Hope the contractor doesn't drive up the prices
>Hope the weather doesn't cause any damage
>Deal with a year straight of headaches, permits, and millions of little problems related to construction
>Be in a college town
>Let strangers live with your family

Seriously, you are WAY oversimplifying the stress related to both building a home and being a renter. You're exposing yourself to so much risk while you're leveraged $200k to the bank just praying something won't fuck up because all your capital's tied up in this investment. There are MUCH safer ways to invest $200k.

[Anonymous No.421563]

>>420918

How is this, in any way, a "get rich quick" scheme?

Also, millions of little problems related to construction? Just say that you don't know a fucking thing about building dude. There are a million little problems related to everything, that doesn't mean that they can't be avoided if you're smart.


>>420863
>well yeah, i'm just exchanging risk for time. but its still less than 10 years to get up to 250k tier, and i never have any risk/liability/stress


>i invested 100% of my savings into a single shitty house

>Zero risk involved!

[Anonymous No.422031]

>The 2008 housing bubble means no real estate investment will ever be safe again
>Becoming a full-time landlord is the only way to make money on housing
>Why have a mortgage when you can tie up 80k in a shithole, and pinch pennies until you can afford a real house? But I wouldn't want to rent out a room, that's for poorfags!
And then there are morons like this >>419697
who, despite presumably having read the thread, still assume the OP lives in the US.
/biz/ might actually know less about its field of interest than any of the other interest boards on 4chan. I think there are literal retards on this board.
And the fucken thing is, there are indeed things to take OP to task about, and they're mostly covered in this guy's post: >>420918. There are a lot of little fuck-ups that could make this venture unprofitable, and I think the chances of such fuck-ups increase when you yourself know dick about building houses/don't have a friend who knows a trade. OP's probably not considering that someone with little construction knowledge would probably get fucked trying to do this.
But no, all /biz/ wants to talk about is "when you want to buy a house, always pay fully in cash" and "hey, instead of renting a room to decrease your mortgage payments, why not own seven apartment complexes!"
And then just absolute reddit shitscum like this: >>419667
>The rest of that is honestly to hard to read xbox...dirtbikes....idk wtf you are talking about.
>idk wtf
>idk wtf
>idk wtf

[Anonymous No.422056]

>>421563
I'll honestly admit that I don't have close experience with home building but I sure as hell know that it's not the kind of venture you want to be leveraging $200k in. Simple things like tornadoes, vandalism, and shoddy construction are too unpredictable and can put you in the hole for the full investment very easily.

Also,
>Guide for making a 50% return on investment in two years
>Not a get rich quick plan

[Anonymous No.422057]

How about some more down to earth concerns?

I don't see taxes and insurance in the numbers breakdown at the top of the post. You have at a minimum property, personal income, rental income, and state (if you live in a state that also taxes personal income). You have a mortgage, you will need insurance. If your property has renters rates will be higher.

Is this enough to derail your plan, maybe. Maybe not.

OP is in the trades. What if you get hurt somewhere in the middle of this plan and can't work?

There are some advantages to buying pre-existing homes at the right price in the right location.

[Anonymous No.422063]

>>422057
I'm pretty sure that gains up to $250k (500 if MFJ) on sale of a home are not taxable. You need to live in and use the home for a full two years, though. So at least that's one advantage to this type of "investment".

http://www.irs.gov/taxtopics/tc701.html

[Anonymous No.422197]

So why don't you just sell the house as soon as it's done?

[Anonymous No.422232]

>>419188

read your blog

[Anonymous No.422249]

>>422031
"fucken thing"

[Anonymous No.422369]

>>419188
Ah you just started out, that's cool. I started reading a similiar blog as well this summer about a guy who's been doing it for like 7-8 years and gotten 600k, but with your high goalpost you'll most likely have to work harder than him.

As I'm doing some things to effectivize my savings now as well as looking into investment alternatives I might start something similiar in the beginning of next year.

[Anonymous No.422375]

>>419277
Have you properly looked into the rental laws where you live?

Where I live you get the rent tax-free as long as their living quarters is connected to the rest of the house and doesn't exceed 50% of it.

Actually I'm living in such a house now. The owner is my age whose father is a fatcat who bought him the house and is paying maintenance on it. On the bottom floor we're currently 3 guys living (could be 4) paying 1k each for our rooms. So that's 3k (potentionally 4k) a month that the son gets without any issues whatsoever.

Family money be damned!

[Anonymous No.423163]

>>421563
>>i invested 100% of my savings into a single shitty house
>>Zero risk involved!

>shitty
>implications
you're not exactly living the dream either building a rental house in the 200s on a property worth less than 6 figures.

here i sit with a house owned in full worth over 150k. i also have saved up over 100k the last 4 years living here. what's the risk again? you have 100% of your savings invested on an empty lot. to build a house entirely with borrowed money. and have to factor in using half the space for renters.

[Anonymous No.423629]

>>423163

>I invested 100% of my savings into a shitty two bedroom house

>Zero risk involved!

[Anonymous No.423633]

>>423629
>shitty two bedroom house
>implications

[Anonymous No.423637]

I would say a house with renters in it is a shitty house.

[Anonymous No.423663]

>>423633

>two bedroom ranch that requires repairs to every single room
>purchased for 80

>not shitty

lol prove it then

[Anonymous No.423667]

>>419707

>it's a 2 bedroom ranch
>loft above the garage
>painted every single room
>redid all of the trim
>replaced every door
>the kitchen was 1990s
>redoing the entire kitchen


>not shitty
>>423633
pic related its ur house

[Anonymous No.423672]

>>423633

Honestly you're going to be a lot better off just posting your address. Yah some people are going to neg on you no matter what it turns out to be, but right now no one believes you. It's not like the concept of finding a deal on a piece of real estate in the last half decade is unheard of, it's just when you deal with this stuff yourself personally, there's a level where it's a good deal, and then there's just trash people try and pass off as not being a mistake, and 80k for a decent area, private sale, good condition, 3 bedroom or whatever sq ft you said, it's close to unheard of. And it's pretty easy to judge a vague level of disrepair from exterior shots as well as neighborhood quality based on how many cars have plastic bags for windows, and if the price matches what you've claimed private party and it has the layout you claim, I'll admit it's a steal of a house if it's only required cosmetics put into it since then.

[Anonymous No.423676]

OP, you probably have no experience renting whatsoever by the sound of it.

Nobody is going to pay anything even close to 1000 a month to live in a room in a basement and essentially share the house with your wife, you, and another person possibly. In any decent city you can get an apartment with practical amenities for 600-900 a month. You either live in the center of NYC or you're full of shit about college students paying that much per month, because I know for a fact at most state universities, room and board is about 4,000 a semester.

OP, good luck to you with this, though. I've rented properties out for the past 10 years. Mostly trailers and shitty homes in a shitty area, but I'm gonna' tell you, there will be problems regardless of who you rent out to.

>Noise
>Police involvement
>Smoking/Partying
>Property destruction
>Thievery
>Late payments
>Lawsuits

Renting a house out is only worth it if you rent the entire house to a couple which can very obviously afford it. I can not stress again: ONLY RENT TO WHITE PEOPLE.

[Anonymous No.423680]

whats so unbelievable about buying a house under priced 4 years ago and it going up in value since?

>>>423663
nothing was required.

>>423672
no thanks, i have no face. but like i said earlier, the whole point is to stay somewhere where the value is held, while my monthly payments are half of what my friends pay for renting a 500sq ft studio. my next house will be in the upper 200s or maybe even the 300s, and ill be doing the same thing i am now, saving up for the next tier while living completely within my means.

[Anonymous No.423684]

>>423676
>Nobody is going to pay anything even close to 1000 a month to live in a room in a basement and essentially share the house with your wife, you, and another person possibly.

They don't set foot in our livable space. Their stairs to their apartment are in the garage, and we have separate stairs to the storage part of the basement inside, and the door just stays locked on those stairs.
Their apartment is nearly 1500 sq feet of livable space. You are mistaken if you think you can rent a 1500 sq ft apartment in "any decent city" for $600/month. Maybe one room in that apartment. There are single bedrooms up for rent in three bedroom apartments, smallish apartments and the bedroom is 10x11, for $575/month near the university we are near.
You said room and board at most state universities is about $4k a semester. Isn't one semester like four months?

We designed the house to keep noise at a minimum, their noisy areas aren't on the same side of the house as our bedroom, and we basically sound proofed their open concept living room and kitchen area as best as we could. I hear ya though man, you make a lot of valid points. I'd probably never rent to two men, and young Asian students are pretty good too.

[Anonymous No.423686]

>>423680
>whats so unbelievable about buying a house under priced 4 years ago and it going up in value since?

I think you're misunderstanding dude. We're not saying that you didn't get a steal, and we're not saying that the house didn't go up in value.

We're saying that it's probably a really shitty house.

[Anonymous No.423694]

>>419062
>>419072

[Anonymous No.423696]

>>423686
what shitty house do you know of that's valued at 150k.

its funny i never even thought of my house much in the last 4 years aside of just a stepping stone to the next one. you guys are really hung up on it.

[Anonymous No.423699]

>>423696
>what shitty house do you know of that's valued at 150k.

lol you aren't making things better for yourself here bud

[Anonymous No.423702]

>>423699
huh?

bottom line is i saved up for 4 years, lived here for 4 years, and now am in a position to own a 250k house in full if i wanted to. op's strategy has him living in a house with renters for 10 years + however long it took him to save up the initial 99k.

[Anonymous No.423710]

>>423702
10 years of living in a big new custom home and end up owning a house worth $300k

or four years of saving every dollar I make, five years of living in a shitty home that requires constant work literally the entire time while still saving every dollar I make and end up owning a house worth $250k


hmmm tough choice

[Anonymous No.423716]

>>423696
which state do you live in. Cause 150k might be a good house in a good neighborhood in Wyoming.
But in my neighborhood* not the best * I live across from manhatten in a building where it cost me 160k for a 2bedroom apartment with two full bathrooms. and 20k for a parking space.
We're talking it costs 180k for a co-op in the Bronx of NYC. granted i could rent out the smaller room and make 600$ a month easy but alas i have family. But private indoors parking and my own apartment not doing so bad.
In 10 years once i have my loan under 50 grand
I plan to sell for hopfully 200-220. and move on up so quite possibly a smaller space in Manhattan in a better neighborhood. for 400ish.

So 150k does not equate to nice house.
I hear in las Vegas shit sells for around that price for home hat aren't to bad either.
or homes that cost 80k in Detroit. with out at least a state your numbers are meaningless.

[Anonymous No.423720]

>>423716

150k does not equate to nice house in like 90% of north america

[Anonymous No.423723]

>>423716
Sorry also. pay about 840 * 40 for parking monthly*a month on top of mortgage and utility bills. the building does cover my winter heating so that's nice.
And if i do buy in manhatten will still lively have to pay 800ish. but will be renting a room by then.

[Anonymous No.423727]

>>423710
>living in a 1750sq ft house half shared with renters, relying on spending every dollar i make plus their rent money to pay off a 100% leveraged home hopefully within a decade.

fify.

i like that you keep trying to belittle me by saying my house is shitty, meanwhile you have no idea what my house is like.
stay mad i guess.

[Anonymous No.423731]

>>423727
>i like that you keep trying to belittle me by saying my house is shitty, meanwhile you have no idea what my house is like.


No idea? No, we have a pretty good idea. A pretty damn good idea.

[Anonymous No.423732]

>>423716
just add a zero to the end of every value itt. it doesn't matter.

[Anonymous No.423734]

>>423727
>relying on spending every dollar i make plus their rent money to pay off

Did you completely miss the part where the mortgage can still be managed while drawing unemployment insurance and not relying on the tenants in the slightest?

>a 1750sq ft house half shared

You seem to believe that a finished basement is included when calculating the square footage of a home.

[Anonymous No.423745]

>>423734
>You seem to believe that a finished basement is included when calculating the square footage of a home.
i understand perfectly well as i have one. half the living space is dedicated to strangers.

>Did you completely miss the part
i saw. glad i never have to deal with any of that shit should i lose my job, get sick, injured, lazy, etc

[Anonymous No.423752]

>>423745
>i understand perfectly well as i have one. half the living space is dedicated to strangers.

You do know that you don't add the square footage of a basement into the total of the home though, right?

Because you said that it's a 1750 sq ft home half shared, but if you didn't finish the basement at all, it's still a 1750 sq ft home. So you're actually not sharing any of the 1750 sq ft.

The main floor is 1750 sq ft, and the basement is 1750 sq ft as well.

[Anonymous No.423755]

>>423752
half the living space is dedicated to strangers.

[Anonymous No.423762]

>>423755

1500 of the 3500 sq ft of livable space is dedicated to strangers, yes.

[Anonymous No.423799]

>>423696
>what shitty house do you know of that's valued at 150k.

Don't you mean 80k? That's what we're getting at. Must have been a real piece of shit...

[Anonymous No.423800]

>>423799
>Must have been a real piece of shit...

seriously it must have been beat

[Anonymous No.423801]

>>423799
my neighbors are getting 150s. my house is better than theirs.

[Anonymous No.423804]

>>423727
>meanwhile you have no idea what my house is like.

Sure we do. You said you bought it for like 80k yet claim it has 3 bedrooms. I know exactly it looks like. See >>423667

You can prove us wrong here, but when you're talking to people who have even a vague idea of the marketplace, we know what 80k bought you. It's great that you're happy with it, and Zen buddhist monk types are happy with literally nothing to their name, but in both cases an extremely large percentage of people *wouldn't* be happy with it. We're just going to have to disagree here, that's all.

Looking at 20 years, you're options are:

1) Build brand new 2000 sq ft home. Pay mortgage for 12 years. Live debt free 8 years.

2) Live in ??? (car?) 1 year. Live in trailer for 4 years. Live in shack for 5 years. Live in newerish 1100 sq ft "utility/cozy" home for 5 years. Buy 15 year old 2000 sq ft home, live in it for 5 years.

So, yah, comparing 1 vs 2, you get your dream home from day 1 and to enjoy it for 20 years. Not seeing the downside....

[Anonymous No.423807]

>>423801

>Bought private party house for 80k 4 years ago
>My house is easily worth 175k+ now, since neighbors crap shacks are going for 150

You keep saying this, but offer no proof of it. I don't know why you think we would believe you. Like I said, you're talking to people who have a decent feel for the market at least. I really couldn't name an area that's had 25% Y/Y growth for the last half decade, so if you want to share, go for it, otherwise, why would you expect us to believe you?

[Anonymous No.423811]

>>423804
>Not seeing the downside....
renters, 250k in debt

>>423807
ive already explained itt the value [and increase] in value of my home really has nothing to do with anything.

[Anonymous No.423813]

>>423804
>Sure we do. You said you bought it for like 80k yet claim it has 3 bedrooms

Actually, I think he said it has two bedrooms. I'd bet one of those two bedrooms is in the finished basement, and that the house itself is like 1000sq ft.

[Anonymous No.423814]

>>423811
>value of my home really has nothing to do with anything.

>claims that his strategy of acquiring a home while making money is superior to OP

>gets called out

>completely refuses to provide a shred of proof or any actual details pertaining to why his strategy is better

>claims that it has nothing to do with the thread

Get fucked

[Anonymous No.423818]

>>423811
>renters
Beats sleeping in your car. Plus added income isn't a terrible thing. We haven't really talked about the numbers here, but having the renters provides for a much larger disposable income. It's not like the mortgage idea *requires* renters. If you can save away the money to buy it cash in a decade, the renters are just gravy on top, and something totally optional. They're *required* when you can save exactly 0, because they're basically paying the house off for you, so we're not really comparing the same things.

> 250k in debt
This isn't like it's a business loan against IP that can evaporate, it's against an asset.

How is it any different than setting aside a certain amount each month for the home fund?

>>my home really has nothing to do with anything.

You presented it as a better option. If you're honest about your financial situation, it's not. It's a much dumber and riskier option. Much easier to gauge and estimate your income than to figure what the real estate market is going to regionally do on each of your home buy/sells.

[Anonymous No.423825]

>>423814
>or any actual details pertaining to why his strategy is better
consider reading the thread.

>>423818
>quarter million in debt
>relying on renters
>unable to save money
>needing unemployment insurance

>It's a much dumber and riskier option.

mfw

[Anonymous No.423853]

>>423825

You're conflating the financial situations of your (supposed) saving self and the average person in OP's post in terms of evaluating the strategies presented, although it's the same conclusion in each.

If you can seriously squirrel away 35k+ a year, you don't need renters, or to rely on unemployment insurance, and you're not really saving money in either case, you need to lockbox if for the home savings/payments. So assuming no renters, etc, why not get a mortgage and pay it off in 10 years and live in the house you want right now? What's the benefit you see out of leap frogging about 3 properties in varying degrees of shitness and hoping there isn't a downswing in properties you own vs an upswing in properties you want (different price brackets behave differently even in the same area) pricing you out of your goal home.

Now compare that to a different situation, where you can't somehow squirrel away 35k+ a year (i.e. 95+% of people). Your choices come down to pay your current expenses and rent while being surrounded by who knows how many and what kind of people for the rest of your life while building 0 equity, or getting a mortgage, paying roughly the same current expenses, in a brand new decent sized house, and deciding who lives next to you, and in a decade having it all to yourself. That's the OP's scenario.

Yes, if you literally bank 6 figures in 3 years, living with renters makes no fucking sense, but neither does living in some dilapidated shack with the cash in the mattress.

[Anonymous No.423938]

>>419557
On this. I rented a house with my girlfriend previously. It was owned by some really religious woman and her son and they didn't approve of unwed people living together and they also learned that we didn't plan on marrying or having kids. She told us this. I told her that no such law existed. She assured me that it did and she'd love to rent to us but couldn't. I then reminded her that I worked for the city Public Housing Authority and dealt with rental laws and unfair rental practices. Signed the lease that same day.

She actually turned out to be really nice, her son was about my age and died in a car wreck and after she would visit us a lot and bring us baked goods and stuff. She loved us too because we paid rent on time, never complained. I'm a very handy person so I did all of the maintenance on the place for rent credit which she loved because she knew I did a good job and charged her way less than a contractor. She had even mentioned at one point about possibly willing me the house when she died since she had no immediate family. Sadly she had a stroke and her sister got power of attorney and sold all her assets to put her in a home and probably pad her pockets.

[Anonymous No.424033]

>>423938

Man. I was like yeah man, this guy went through it, he knows his shit. And then you pull the rug out on me like that.

[Anonymous No.424674]

>>423825
>>relying on renters
>>unable to save money

I've come to the conclusion that this guy is actually fucking retarded. How is one unable to save money when their mortgage is being paid by someone else?

[Anonymous No.424682]

>>424674
>How is one unable to save money when their mortgage is being paid by someone else?
it's being supplemented.

[Anonymous No.424718]

>>423825
>>needing unemployment insurance

Do you even know what unemployment insurance is?

it's not a payment like your car insurance, dumbass

[Anonymous No.424729]

>>424718
who cares?

stay mad.

[Anonymous No.424736]

>>424729

>"Stay mad." - a guy that lives in an $80,000 house

[Anonymous No.424739]

>>424736
how is it worth 80 if my neighbors houses in worse condition are getting 150s?

keep trying.

[Anonymous No.424790]

>>424739
how many square feet is it

[Anonymous No.424828]

>>424739
how many square feet is it

[Anonymous No.425161]

>>424790
>>424828


"That doesn't matter, trust me guys, it's worth as much as I say"

[Anonymous No.425199]

>>424739
>how is it worth 80 if my neighbors houses in worse condition are getting 150s?

Because you still have yet to describe any significant details with proof about how you acquired this 80k house that needed repairs in every room to validate it's current valuation.

Therefore, whatever makes you think your house is on par with your neighbors is clearly wrong. The fact that someone had to basically give away the house means there's something seriously wrong with it that's obvious within seconds to anyone else that looked at buying it. You may have unknowingly corrected the problem, and maybe you'll find someone else equally retarded to pawn it off onto, but considering you haven't mentioned what this fire sale issue was, you most likely weren't even aware of it, which is too funny. Anyway, until you sell it to someone for 160k+, all the numbers are bullshit. It's worth whatever someone else will pay for it. You might as well claim it's worth 400k or a million, you have no basis for this unless you had someone at least show up and offer you that much for it.

[Anonymous No.425542]

>>425199
>The fact that someone had to basically give away the house means there's something seriously wrong with it that's obvious within seconds to anyone else that looked at buying it.

I was wondering if maybe it had some serious issue that he wasn't aware of or something. Intense termite infestation or something like that.

[Anonymous No.425664]

Why would someone invest so much time and effort into "proving" that they have a sound strategy and then outright refuse to provide any details?

[Anonymous No.425710]

>>424790
>>424828

see
>>423732

>>425161
or zillow, or my neighbors houses


>>425199
>>425542
>what was the housing market bubble

[Anonymous No.425711]

>>425664
because the house has nothing to do with the strategy.

[Anonymous No.426005]

>>425710
>>425711

>still skirting questions

[Anonymous No.426008]

>>425710
>>what was the housing market bubble

Again, you don't provide any details and expect us to believe you? It's why we don't. Just give me a zip code at least, because you're claiming 25+% Y/Y for 4+ years, which if you knew anything about real estate, you would realize how retarded that sounds. Your area would have had to been hit harder than average by the bubble pop *AND* have mounted a bubble recovery faster and *sooner* than average. If what you're saying is true, it'll be true across your zipcode, and a zipcode wouldn't be anywhere near enough to identify who you are, so let's have it.

[Anonymous No.426019]

>>426008
then dont believe me.

ive already explained that it doesnt matter the value of the home now, it could still be 80k. the home wasnt purchased thinking it would increase in value as it has.

[Anonymous No.426052]

>>426019
>ive already explained that it doesnt matter the value of the home now

What? You spent TENS OF THOUSANDS on it yearly and had the cash sunken into the property doing 0 work for you. If it hasn't done 10+% Y/Y you've effectively lost money.

Oh well, this isn't going anywhere and this thread is pretty old so I'm probably done with. I hope whatever leapfrog strat works for you dude, but walking into some "amazing" deal is usually some scam or at least an information disparity, so just keep that in mind. It's criticisms but in the end it's a little concern as well.

[Anonymous No.426081]

>>426052
how do you figure tens of thousands? property taxes and insurance are about 4000 a year.

the 25k/year ive saved for the next house while living here has been invested.

>but walking into some "amazing" deal is usually some scam or at least an information disparity
everyone that bought a house when i did got an amazing deal compared to the market today.

you're still missing the point. even if the house was worth 80k today, i would have 80k + all the money saved while living here (125k+interest) for the next house (over 200k). all owned in full, without risk of losing my house, a ridiculous loan, or renters.

[Anonymous No.426127]

>>426081
>how do you figure tens of thousands? property taxes and insurance are about 4000 a year.

And you've lived there for four years, and you said that you've invested $10k+ in repairs and such. So, at the very least, assuming that your time and effort is worth absolutely nothing, you have $24,000 invested in the house, which, as you just said, is what you are able to save in a year.
Hence, tens of thousands, just like he said.

That's also assuming that utilities are free the entire time, and that you've had to make zero repairs that cost money aside from the purposeful repairs you're doing to increase the value of the house.
>even if the house was worth 80k today, i would have 80k + all the money saved while living here
So any investment is justified if you're able to save money elsewhere? Pretty strange logic there bro.

[Anonymous No.426144]

>>426081
>everyone that bought a house when i did got an amazing deal compared to the market today.

Median existing home sales price Jan 2009:
172k (I'll assume you managed to buy at the absolute bottom)
Median existing home sales price Jan 2014: 188k (Yay recovery???)

This is why we don't believe you on valuation growth bro...

You may be living in some amazingly unique area, but your reluctance to share that raises a lot of skepticism at best.

As for the 10s of thousands, that's taxes, insurance, lost investment revenue on the purchase price, on top of all the repairs you've done, materials + labor. Contractor are $120/hr. Like I said, you want to value your time as worthless, fine, but any sane valuation of economic value doesn't work like that.

[Anonymous No.426169]

>>426081

I just realized something. If you had taken the $80k and built a smaller two bedroom house like the one you live in now, on a cheaper lot , your total cost would likely be around $150k. Minus the $80k you had saved, you'd need a mortgage for $70k. That's a payment of $324/mth. So $3888 per year. Living a similar, minimalistic type of lifestyle, you'd be able to save the $25k/year still, minus the cost of your mortgage of course.

So you're taking $21k off of what you owe each year, and you're paying your mortgage off in the middle of the third year. By the end of the fourth year, where you are right now, you'd have saved ~$12k in the second half of the third year, and the $25k that you saved in the fourth year because you no longer had a mortgage payment. You've got $37k in the bank, and, because you can build a house for less than what it's worth to sell, you sell the nearly-new house for a $30k profit.
You'd get $217k, which is about $23k less than you're claiming you could have right now if you sold your house for $140k, but you didn't have to work on an old house for four years, and you lived in a new house in that time instead. And you didn't have to spend $10k on renovations, so that's actually only about $13k less in the end.

Being able to live a minimalistic lifestyle and save money like you do, you are the exact type of person that benefits most from a build, because you're entirely able to pay the mortgage off quickly, and you started with a large sum. You could have taken the house you're in now, and turned it into a house that was brand new, in the same amount of time, with the same lifestyle, minus the extra work you did on the old house. Even with this absolute steal that you claim to have made off with right at the precise, critical timing of the market crash, I think you probably still could have built a similarly sized house and came to the exact same financial gain, as well as owned a new house rather than an old beat.

[Anonymous No.426174]

>>426169

>inb4 balking at the "financial risk" of being $70k in debt while claiming you are able to save $110k over four years

[Anonymous No.426184]

>>419397
>negative equity.

As long as you pay the mortgage, if the house is upsidedown on the mortgage, you'll be okay.

The problem was that people couldn't afford their mortgages.