Three Home-Owning Strategies We are Skipping

Access hatch under a conference table

It comes up a lot. People generally can’t believe that a married couple our age are voluntarily choosing to rent instead of own a home. One of our young ones came over on open house night, and blurted out, “You guys RENT??” Like it had completely violated his impression of us or something!

That’s generally how you know you’ve hit upon a truly contrarian position. Nobody understands it or why you’re doing it. Young or old, rich or poor, artist or business professional, nobody gets it.

You don’t... own... a car?

You... don’t... drink coffee?

You... actually like... the middle seat?

Personally, I do weirder things, like using chopsticks with my non-dominant hand, and nobody notices that stuff at all. Most of the time people are just thinking about themselves, that or their phone.

You can get away with A LOT in plain sight. People may give feedback in one form or another, but that doesn’t mean you have to pay attention or base your major strategic decisions on their opinion. Especially if you think the common denominator isn’t working for most people.

Default: tired, broke, cluttered

To sum up, our strategy is to rent a tiny apartment, use public transport, and max out our retirement contributions. Literally anyone in the world can live in a small space and not own a car. This is not elitist. It’s about the complications you are willing to tolerate.

What are the three basic home-owning strategies?

1. Buy the nicest house in the nicest neighborhood that you can afford
2. Buy the cheapest house in the nicest neighborhood, etc., and fix it up
3. Geographic arbitrage: buy the nicest house in a cheaper part of the world

Ideally we would love #1. We live in Southern California right now, and we agree that it’s paradise. It’s a combination of a beautiful place with a great climate, ready access to fascinating work opportunities, and a culture that suits us. Unfortunately, buying an amazing house where we live costs about 4x as much as the same house somewhere else.

We understand #2, and we know precisely how to do it. We are both tool-oriented DIY types, part of our initial attraction to one another. One of our few continual quarrels revolves around who gets to assemble new furniture. The problem with this strategy is that all your free time, evenings, weekends, and holidays, goes to fixing up the house. It becomes your only hobby, that and accidentally breaking some drywall.

#3, geographic arbitrage, is something else we understand. Pack up and go somewhere else, like... Belize? Our biggest problems with this strategy are 1. Jobs, 2. Our pets, and 3. Choosing one place. Quite frankly we would only go in this direction at the point of retirement, and neither of us really believes in retirement as a thing.

Oops, another hot take! Let’s save that one for a different day.

The biggest problem with owning a house is that nobody wants to talk about the externalities.

The closing costs, the annual maintenance costs, the higher utility bills and other hidden costs, the extra chores of yard work and housework, the risk position, the house becoming a character in your story and demanding things, like extra furniture.

Risk position! There are NO GUARANTEES that you won’t need extensive wiring work, plumbing repairs, and a new roof, just as you find out you have a cracked foundation... and then you get hit with a major natural disaster shortly after finishing it all. When you own a house the buck stops with you.

People will try to talk you into home ownership in the same way they try to talk you into having children, or adopting a cat. They won’t talk about all that stuff like burst pipes, teething, or the cat barfing on your bedspread. “It’s different when they’re yours!” Yep, my point exactly.

The main reason that my husband and I haven’t bought a house is the way mortgages are structured. The loan is front-loaded, and almost everything you pay for the first five years is interest. You aren’t building equity. Due to our strategic position on career growth, we haven’t felt that we could guarantee we would stay in one city for five years. We decided that before we got married, and in point of fact, we were right.

If we had chosen the house over the career opportunities, we would have had to pass up several promotional choice points. We’d be making 50% less money, and, to be honest, I would probably be tired of the house and constantly being in Remodel Purgatory.

It’s my nature. If I lived in the fanciest house on the entire planet, there would be something I didn’t like about it, and I would want to either rearrange all the furniture or remodel something. I don’t have it in me to just fall in love with one specific building and want it to never change.

There are other home-ownership strategies out there, and probably room for more, because anything can be modified or disrupted. For instance, a lot of people live with their parents and save money, and someone could probably do something similar while house-sitting. Another common one is to live in a granny unit or put in a garage or basement apartment, get tenants for the main house, and use their rent to pay down the mortgage. Or get a job that includes housing, like working on a cruise ship or at a fire watch tower, and save as much money as possible.

One day, we might buy a house. We’d do it when we had fallen in love with that city, when we had a sense of knowing about that property, when we had nothing better to do with our copious spare time. When that will be, only time will tell. In the meantime, yeah, we rent. What’s it to you?