Resilience Club: Reduce Your Housing Costs
Dec. 4th, 2021 10:00 pm![[personal profile]](https://www.dreamwidth.org/img/silk/identity/user.png){kind=small}
jenniferkobernikI think the main obstacles to creative problem-solving in the realm of housing cost reduction are A) unfamiliarity with alternatives to conventional housing (or the idea that they are something other [abnormal] people do and therefore not real possibilities) and B) an emotional attachment—even a sense of entitlement—to the idea of a home of one’s own.
We could argue all day about whether or not there is a social or moral imperative to provide decent housing for all, but the fact of the matter is that, from a global and historical perspective, the expectation of stable, sanitary permanent housing in a safe neighborhood with access to conveniences for every nuclear family would be considered delusional. That doesn’t mean that you shouldn’t aim for a permanent single-family home (or perhaps a modest apartment), or that you might not be better off with one, but if you simply can’t afford it but keep throwing all your resources at it anyway, digging yourself perpetually deeper into a financial hole, you’re not doing yourself any favors.
On that note, if you think of your house as an asset or an investment, I advise you to stop—unless it makes you more money than it costs you, in which case please comment below and tell us about it.
In this post, I will outline some ideas about alternatives to conventional housing, as well as ways to make conventional housing less expensive. Some of these ideas can also be implemented when you are younger and more physically resilient in order to save enough money to purchase something more conventional that would otherwise be out of reach (and, by saving up a large downpayment, reduce the interest which comprises a major portion of the mortgage cost).
Now, on to a list of options to consider:
Build your own house
You can do this on cheap raw land, borrowed land, or on a trailer so you can take it with you.
Building an immobile home gives you more options for using natural, non-toxic, and cheap/free materials (cob, logs, straw bales, etc.), but you need somewhere to build it. Using natural materials will very likely cut down on your long-term healthcare costs, is much less damaging to the earth, and is more aesthetically pleasing (in my opinion), so I prefer to do so..
Land is cheap if you are willing/able to live in the middle of nowhere. For the price of a deposit and first and last month’s rent in many cities, you can own a couple acres of land, although you might have to do some finagling to buy a small parcel cheaply (large acreages are often cheaper per acre). Land is less cheap in places with decent communities and employment opportunities, but you can probably find a land share arrangement in most places if you try hard enough. This has the potential to introduce interpersonal drama. Interpersonal drama is the price you pay for access to community and to other people’s resources. If this is intolerable and you must have more control, you probably need to spend more money. You might want to aim to purchase relatively conventional housing and offset the costs as much as possible (see below).
A mobile tiny home will cost quite a bit more per square foot (as it requires stronger framing and, of course, a trailer) and is more technically difficult to build, but it does allow you the flexibility of moving if things fall through. Learning to weld is not too difficult and will aid you in this endeavor. You will likely need to use lightweight, unnatural building materials, especially if you follow a ready-made building plan.
Move into a car, truck, van, RV, or boat
If you don’t want to build a mobile dwelling, you can buy one. There are many YouTube channels, blogs, books and other resources about “van life,” “sea gypsies,” and other mobile communities. I lived in my truck for a number of years and liked it. I worked summers as a campground host in a national forest, camped for free, and was paid minimum wage. You can camp on public land, stealth camp in the city, or park in a friend’s yard and live very cheaply.
Live in a tent
I’ve lived in a tent for several months in a row at various times. This is of course easier in certain climates and at certain times of year, but with good backpacking gear, you can make it work in most places for most of the year. If you know anyone with a yard who will let you pitch your tent, or you live near (or can move near) public land or trails, you can live rent-free for months at a time while saving money, searching for housing, building a more permanent structure, or doing whatever else you would do if you didn’t have to pay rent. The upfront cost and money lost to depreciation is much less than with a vehicle, and you can get started almost immediately.
Rent a small space from someone else—a room, part of a room, an outbuilding, a loft, etc.
Spare rooms and garage or basement apartments for rent are common, but you can also rent space in sheds, barns, parked buses/vans, and many other unconventional spots. My husband once rented half a closet (someone else rented the other half, and even had her boyfriend over occasionally) and someone else I know rented a bathtub in an extra bathroom to sleep in. Many of these options are significantly cheaper than renting a more conventional space.
House sit, pet sit, plant sit, farm sit, or sit with a sick or disabled person to get access to other people’s houses and/or land
This can be short-term (say, for those who live in a vehicle to get access to a nice house and amenities occasionally for a few days or weeks) or long-term (say, acting as a caregiver for an aging person for several years). Many of these positions are paid, in addition to the free rent, especially if you have certain qualifications (a nursing license, for instance). I have also seen these situations result in inheritances for the caregiver or laborer upon occasion, although I wouldn’t count on it.
One subset of this category worth mentioning is that of aging farmers—they are often willing to share land with young, spry, aspiring farmers. They will probably only respect you if you work hard (farmer hard, not college kid hard) and will probably be crotchety and overly opinionated, and may delight in drenching things with poison (unless you can find an organic farm). But they are often also sitting on millions of dollars of depreciating capital and valuable knowledge that they don’t want to go to waste, and are often more open to the experience of land sharing than most people, in my experience.
Move in with an (aging) relative or friend
This is similar to the above, but more permanent and with someone you are close to; you care for them and/or their property in exchange for housing or land on which to build your own house; you may come to an understanding in which you inherit the property upon their death. If this person is a parent, it can also save you/them the absolutely exorbitant costs of long-term care. This path is very emotionally challenging for most people.
Of course, you could also move in with a relative or friend as a guest or roommate, if anyone is willing.
Participate in Workaway, WWOOFing, couch surfing, etc.
These programs are usually aimed at travelers, but they don’t have to be. If you are in need of relatively short-term free housing to save up money, these are worth considering.
Make conventional housing work for you
If you must buy a “normal” home for whatever reason, about the only advice I can give is to pick a modest house or housing unit in a modest location with a large down payment (preferably 30% or more). Renting is an option as well; you don’t build equity, but the risk is lower. Whether renting or buying, make sure your monthly payments can be made even if one person in your household loses their job, or could be covered by getting a roommate if you’re a single-income household. Have three months’ worth of payments saved up at all times. Pay off the mortgage as early as possible. If you can’t afford to do this, you just can’t afford to buy (or rent) a conventional home of your own. It sucks, but reality is reality. Now, on to some strategies for offsetting the cost of conventional housing.
Get a roommate or rent out a room occasionally
If you do buy a home or already own one, consider getting a roommate or renting out part or all of your house on a service like AirBnB (stay with a friend or go camping if somebody rents the whole place). Also consider friends or relatives who are struggling with their own housing costs and might want to rent a room, build a tiny house in your backyard, convert your shed, or camp in their vehicle on your land. What might be a great deal on rent for them could be more than enough to take the pressure off of you. Also, consider whether potential roommates might contribute money-saving skills such as mechanics, handyman work, gardening, or cooking from scratch in lieu of or in addition to rent, if things such as car repair or restaurant bills are regular budget-busters for you. Save up a few months’ of payments and shave some extra off your principal before you need to, and you will be better prepared when you do need to.
Stop outsourcing domestic tasks and reduce recurring expenses
Learn to do your own repairs, yard work, cooking, cleaning, etc. if you currently pay for these services. Actually read your insurance policies to see if they make sense, and shop around. Consider some energy-saving retrofits or new habits. Get rid of television and internet services unless they actively make you money (say, by allowing you to work from home).
Start a cottage industry, side hustle, or home-based business
Consider whether you can make what would otherwise be a sheer liability (your house) work for you by starting a cottage industry or running a business out of your home and taking a home-office deduction. These measures might at least offset the financial drain, and will help cushion the blow if you lose your job.
If you are not underwater, you might consider selling out and downsizing, but this requires careful research and comparisons taking all fees and expenses into account.
If you ever do pay off (part of) your mortgage, for goodness’ sake don’t turn around and take out a home equity loan on it! And don’t remodel unless you’re rolling in cash or it’s genuinely necessary (your walls are full of mold and termites have eaten the joists under your floor, for instance).
Finally, consider that property taxes, insurance, and other expenses may rise steeply and strain your resources even after your mortgage is paid off, especially if you are on a fixed income at that point. Keep a few months’ worth of vital expenses on hand, consider developing some alternative income streams, and stay flexible enough of mind and attitude to employ some of the tactics listed above if they become necessary, before it is too late.
I have seen many people lose their homes to foreclosure or eviction without doing something as simple as looking for a roommate or subletting their condo while moving in with relatives, because, as far as I could tell, it never occurred to them—they “weren’t that kind of person” and so ended up homeless and bankrupt rather than adjusting their lifestyles.
Most of these solutions are fairly obvious; the trick is in developing the will to use them appropriately and in time, and the skills (physical, psychological, social, emotional) to preserve or even enhance your quality of life in the process.
Enjoy the turning of the year; the next post in this series will be out on January 4th!
We could argue all day about whether or not there is a social or moral imperative to provide decent housing for all, but the fact of the matter is that, from a global and historical perspective, the expectation of stable, sanitary permanent housing in a safe neighborhood with access to conveniences for every nuclear family would be considered delusional. That doesn’t mean that you shouldn’t aim for a permanent single-family home (or perhaps a modest apartment), or that you might not be better off with one, but if you simply can’t afford it but keep throwing all your resources at it anyway, digging yourself perpetually deeper into a financial hole, you’re not doing yourself any favors.
On that note, if you think of your house as an asset or an investment, I advise you to stop—unless it makes you more money than it costs you, in which case please comment below and tell us about it.
In this post, I will outline some ideas about alternatives to conventional housing, as well as ways to make conventional housing less expensive. Some of these ideas can also be implemented when you are younger and more physically resilient in order to save enough money to purchase something more conventional that would otherwise be out of reach (and, by saving up a large downpayment, reduce the interest which comprises a major portion of the mortgage cost).
Now, on to a list of options to consider:
Build your own house
You can do this on cheap raw land, borrowed land, or on a trailer so you can take it with you.
Building an immobile home gives you more options for using natural, non-toxic, and cheap/free materials (cob, logs, straw bales, etc.), but you need somewhere to build it. Using natural materials will very likely cut down on your long-term healthcare costs, is much less damaging to the earth, and is more aesthetically pleasing (in my opinion), so I prefer to do so..
Land is cheap if you are willing/able to live in the middle of nowhere. For the price of a deposit and first and last month’s rent in many cities, you can own a couple acres of land, although you might have to do some finagling to buy a small parcel cheaply (large acreages are often cheaper per acre). Land is less cheap in places with decent communities and employment opportunities, but you can probably find a land share arrangement in most places if you try hard enough. This has the potential to introduce interpersonal drama. Interpersonal drama is the price you pay for access to community and to other people’s resources. If this is intolerable and you must have more control, you probably need to spend more money. You might want to aim to purchase relatively conventional housing and offset the costs as much as possible (see below).
A mobile tiny home will cost quite a bit more per square foot (as it requires stronger framing and, of course, a trailer) and is more technically difficult to build, but it does allow you the flexibility of moving if things fall through. Learning to weld is not too difficult and will aid you in this endeavor. You will likely need to use lightweight, unnatural building materials, especially if you follow a ready-made building plan.
Move into a car, truck, van, RV, or boat
If you don’t want to build a mobile dwelling, you can buy one. There are many YouTube channels, blogs, books and other resources about “van life,” “sea gypsies,” and other mobile communities. I lived in my truck for a number of years and liked it. I worked summers as a campground host in a national forest, camped for free, and was paid minimum wage. You can camp on public land, stealth camp in the city, or park in a friend’s yard and live very cheaply.
Live in a tent
I’ve lived in a tent for several months in a row at various times. This is of course easier in certain climates and at certain times of year, but with good backpacking gear, you can make it work in most places for most of the year. If you know anyone with a yard who will let you pitch your tent, or you live near (or can move near) public land or trails, you can live rent-free for months at a time while saving money, searching for housing, building a more permanent structure, or doing whatever else you would do if you didn’t have to pay rent. The upfront cost and money lost to depreciation is much less than with a vehicle, and you can get started almost immediately.
Rent a small space from someone else—a room, part of a room, an outbuilding, a loft, etc.
Spare rooms and garage or basement apartments for rent are common, but you can also rent space in sheds, barns, parked buses/vans, and many other unconventional spots. My husband once rented half a closet (someone else rented the other half, and even had her boyfriend over occasionally) and someone else I know rented a bathtub in an extra bathroom to sleep in. Many of these options are significantly cheaper than renting a more conventional space.
House sit, pet sit, plant sit, farm sit, or sit with a sick or disabled person to get access to other people’s houses and/or land
This can be short-term (say, for those who live in a vehicle to get access to a nice house and amenities occasionally for a few days or weeks) or long-term (say, acting as a caregiver for an aging person for several years). Many of these positions are paid, in addition to the free rent, especially if you have certain qualifications (a nursing license, for instance). I have also seen these situations result in inheritances for the caregiver or laborer upon occasion, although I wouldn’t count on it.
One subset of this category worth mentioning is that of aging farmers—they are often willing to share land with young, spry, aspiring farmers. They will probably only respect you if you work hard (farmer hard, not college kid hard) and will probably be crotchety and overly opinionated, and may delight in drenching things with poison (unless you can find an organic farm). But they are often also sitting on millions of dollars of depreciating capital and valuable knowledge that they don’t want to go to waste, and are often more open to the experience of land sharing than most people, in my experience.
Move in with an (aging) relative or friend
This is similar to the above, but more permanent and with someone you are close to; you care for them and/or their property in exchange for housing or land on which to build your own house; you may come to an understanding in which you inherit the property upon their death. If this person is a parent, it can also save you/them the absolutely exorbitant costs of long-term care. This path is very emotionally challenging for most people.
Of course, you could also move in with a relative or friend as a guest or roommate, if anyone is willing.
Participate in Workaway, WWOOFing, couch surfing, etc.
These programs are usually aimed at travelers, but they don’t have to be. If you are in need of relatively short-term free housing to save up money, these are worth considering.
Make conventional housing work for you
If you must buy a “normal” home for whatever reason, about the only advice I can give is to pick a modest house or housing unit in a modest location with a large down payment (preferably 30% or more). Renting is an option as well; you don’t build equity, but the risk is lower. Whether renting or buying, make sure your monthly payments can be made even if one person in your household loses their job, or could be covered by getting a roommate if you’re a single-income household. Have three months’ worth of payments saved up at all times. Pay off the mortgage as early as possible. If you can’t afford to do this, you just can’t afford to buy (or rent) a conventional home of your own. It sucks, but reality is reality. Now, on to some strategies for offsetting the cost of conventional housing.
Get a roommate or rent out a room occasionally
If you do buy a home or already own one, consider getting a roommate or renting out part or all of your house on a service like AirBnB (stay with a friend or go camping if somebody rents the whole place). Also consider friends or relatives who are struggling with their own housing costs and might want to rent a room, build a tiny house in your backyard, convert your shed, or camp in their vehicle on your land. What might be a great deal on rent for them could be more than enough to take the pressure off of you. Also, consider whether potential roommates might contribute money-saving skills such as mechanics, handyman work, gardening, or cooking from scratch in lieu of or in addition to rent, if things such as car repair or restaurant bills are regular budget-busters for you. Save up a few months’ of payments and shave some extra off your principal before you need to, and you will be better prepared when you do need to.
Stop outsourcing domestic tasks and reduce recurring expenses
Learn to do your own repairs, yard work, cooking, cleaning, etc. if you currently pay for these services. Actually read your insurance policies to see if they make sense, and shop around. Consider some energy-saving retrofits or new habits. Get rid of television and internet services unless they actively make you money (say, by allowing you to work from home).
Start a cottage industry, side hustle, or home-based business
Consider whether you can make what would otherwise be a sheer liability (your house) work for you by starting a cottage industry or running a business out of your home and taking a home-office deduction. These measures might at least offset the financial drain, and will help cushion the blow if you lose your job.
If you are not underwater, you might consider selling out and downsizing, but this requires careful research and comparisons taking all fees and expenses into account.
If you ever do pay off (part of) your mortgage, for goodness’ sake don’t turn around and take out a home equity loan on it! And don’t remodel unless you’re rolling in cash or it’s genuinely necessary (your walls are full of mold and termites have eaten the joists under your floor, for instance).
Finally, consider that property taxes, insurance, and other expenses may rise steeply and strain your resources even after your mortgage is paid off, especially if you are on a fixed income at that point. Keep a few months’ worth of vital expenses on hand, consider developing some alternative income streams, and stay flexible enough of mind and attitude to employ some of the tactics listed above if they become necessary, before it is too late.
I have seen many people lose their homes to foreclosure or eviction without doing something as simple as looking for a roommate or subletting their condo while moving in with relatives, because, as far as I could tell, it never occurred to them—they “weren’t that kind of person” and so ended up homeless and bankrupt rather than adjusting their lifestyles.
Most of these solutions are fairly obvious; the trick is in developing the will to use them appropriately and in time, and the skills (physical, psychological, social, emotional) to preserve or even enhance your quality of life in the process.
Enjoy the turning of the year; the next post in this series will be out on January 4th!
no subject
Date: 2021-12-06 02:35 am (UTC)Thanks for the thoughtful post. Glad to see you back on this project.
I am in more or less the conventional kind of housing - single-family house in a residential neighborhood. However, there are ways to make that option more affordable.
One option, as you mention, is picking a cheap location. What we paid for our house wouldn't make a down payment in some of the hotter real estate markets. Generally smaller towns, out of commuting range of the big cities are what you are looking at here. Another trick is to consider the houses that everybody else overlooks. Ours did not have any parking on the lot when we bought it, which pretty much made it inconceivable for anybody else in town. Older buildings and very small houses can fall into that category, too.
Once you are in a house or other living arrangement, there are lots of things you can do to save money. I believe in spending money while I have it, so I don't have to later. I drew up a spreadsheet analysis of our household expenses, and ordered them from greatest to least. Then, for each line, I tried to come up with at least one idea for how to reduce monthly/annual expenses. For electricity, it might be replacing all the light bulbs with LEDs. For water, it could be rainwater capture or greywater recycling. Insulation and weatherproofing are great for reducing fuel and/or electricity bills. I figure that if the resultant savings will pay for a project within ten years, it is definitely worth doing.
As you say, houses are generally money-losers, not money-makers. One of the advantages of having a relatively larger space, though, is that you can do more work there. Canning and other food processing can save a lot of money over buying the same things. Having tools handy to fix things helps to reduce purchases, too. A home can be a place to work and be productive, not just to sit and stare at the TV.
On a different note, a book I read at the library a while back recommended renting a storefront and living in it. You can run a business in the front, sleep in the back, and only pay one rent.
no subject
Date: 2021-12-19 08:09 pm (UTC)no subject
Date: 2021-12-06 03:00 pm (UTC)I recommend the Granola Shotgun blog for anyone interested in setting up your house to accommodate roommates or boarders without raising any red flags for the various permitting authorities in your jurisdiction.
no subject
Date: 2021-12-19 07:51 pm (UTC)Thank you
Date: 2021-12-09 07:30 pm (UTC)We are currently homeowners, in what I thought was a good place to ride out the oncoming collapse. But like Ip9 above, we instead ended up as a tiny isolated island in a sea of medical tyranny. So we're looking at a possible new locations in the spring.
I briefly toyed with the take an RV year idea but I'm concerned about gas prices. I'm currently scoping out caretaker.org to see if there are any possibilities. There are a lot of options like that for a couple like us who is handy and domestic but with a kid and pet, fewer. This is my first choice since we guess that our next stop might not be a permanent one, just a year or so until we understand what the next phase of all this is. One thing I've seen in my searches is "inn sitters", sort of like your campground job but with inns.
Lots of food for thought. This topic will be on my mind until we resolve our status in the spring so thank you. :) - kma
Re: Thank you
Date: 2021-12-10 02:52 pm (UTC)Re: Thank you
Date: 2021-12-10 03:33 pm (UTC)IIRC, you are in the garden state? My F-I-L is there so we keep an eye on that location.
Re: Thank you
Date: 2021-12-10 05:01 pm (UTC)Re: Thank you
Date: 2021-12-13 04:53 pm (UTC)I played the "best place for us to collapse" game 20 years ago and came up with our current location so it occurs to me that a black swan event can take down anyplace and we should perhaps focus on people first and place second. But then again, laws are important as is currently seen. So much to think about...
Re: Thank you
Date: 2021-12-19 06:52 pm (UTC)I know quite a few people who have found stuff through caretaker.org. And I’ve found that a lot of people are pretty open to kids and dogs, as long as they’re not obnoxious! Makes you look stable and not shady, which is a plus.
Gas prices are a definite concern, especially if you are actually driving a lot. If you can find a free/very cheap place to park and then bike from there, or just stay put most of the time, it’s not so bad, but actually traveling the country in an RV can be painfully expensive (but then, so can rent).
Re: Thank you
Date: 2021-12-22 05:27 pm (UTC)saving on house expenses
Date: 2022-03-06 05:40 am (UTC)First, everything I did before I became disabled that save money I have found invaluable and allowed me to stay here. When I moved and had to buy another house, I did NOT reset to start all over with a 30 year loan, I thought it was a bad idea to extend the time I had already signed up for and got a 15 year loan on the purchase - I could do this by not "upgrading", I bought a modest house; I resisted as much as possible getting home equity debt, after I was disabled I did use money off a home equity loan just to put on a new roof. I have not done remodeling or other expenses with that kind of loan as a lot of people do; When I first moved here and had cash, I put in energy saving items, new windows, solar hot water, a small solar electric, a used wood stove, I got rid of 3 window air conditioners and instead put in 2 skylights and planted grapes to shade the south facing deck; I put a timer on the electric hot water heater; I did not buy a clothes dryer. The result was that I have had a lot lower expenses than many neighbors, I do not regret any of the money spent then on items that have saved me money ever sense. I am so glad that when I moved, I stayed with a modest size house.
I planted a few fruit trees when I moved here, the grapes, and have encouraged other edibles to go wild so even when I dont feel well, the yard looks bad, but actually, it is very easy to forage for high vitamin food, fruit and greens without work.
I have had a roommate for years while my children were growing up to supplement income and to be able to pay off the mortgage. As time went on, we added a small bathroom and kitchenette so that that large room could be stand alone with its own entrance. At this point, the mortgage is paid off, my income is even lower but I now have that higher rental income to compensate. It is not alot, but more than just renting a room and no one is messing up my space. It is enough to pay for the property tax and home insurance and a few hundred more a month which most of it ends up getting paid for maintanence for the unit and for the guy who does weedwacking, cutting tree branches. I am trying to make it not cost me to have this place to live, to be more resilient in that way.
Re: saving on house expenses
Date: 2022-03-10 04:14 am (UTC)