How to own a home

Note: This is solutioneering. This post doesn’t talk about whether any of this is justice, it simply tries to understand and adapt. Like many answers to questions which have no answers, it will hopefully enable us to ask better questions.

Why are house prices?

House prices are for two reasons:

• Most people (with some exceptions in rough social makeup) own a house, and they won’t do things to reduce the value of their house. This is true even if they don’t want to sell the house. This is especially true if they have a home loan, which increased house prices will force people to get larger ones of. This means that for most people, house prices going up simply has to be a fact of life. The system will not tolerate a housing drop.
• Speculators (and in Australia this means anyone with enough of a tax burden, because of the sort-of crazy way that negative gearing works) want to buy houses in areas that are “good”. “Good areas” just means that the community invested in that area. This means that if you’re renting, just by existing you’re increasing the value of the house and houses in the area. Your landlord takes that profit.

Option 1: Victimise others

No matter your budget, there’s a house you can afford, just not one anywhere near where you can live, so one option is to buy a house in a place where house prices are extremely low. You need to be comfortable with the reasons why they are low, but if you are, then buy in that area.

Then, get a tenant, and keep renting where you are. The rental income might be enough to cover the interest payments. Then, invest in the area. This means go near your house as often as you can, and spend time and money in that area. Party, relax, holiday, you want the area to have more activity so the house price goes up. It doesn’t have to be a lot of money by the way, the point is that you just being there makes the house prices in the area go up.

If you have friends or trusted compatriots, buy up a bunch of houses in an area and have the lot of you visit the area often and keep investing in the community. This will boost the house price. In a few years, you can probably sell the house for a tidy profit. Then, buy a house in an area closer to where you live, rinse and repeat.

Oh, and house prospecting is your hobby now. Sorry. Remember that thing about the answer just forcing you to ask more questions? This is one of them.

Option 2: Go halves

Find someone you trust, go halves. You probably need contracts or something, and it’s good to have those, because they say “trust but verify”. Good fences make good neighbours, and good contracts make good business partners.

It might work out better to actually rent the house out (maybe to one of you) than actually live in the house, because again you might end up with a house far away, but that’s capitalism I guess, instead of having a house you can live in it makes more sense to rent a house and own a different house.

Oh but you can’t actually do things which people do with houses, like drill a hole or choose your own kitchen, but those are questions.

Option 3: Tiny house

Buy a fancy caravan on wheels and just truck it wherever you like. You probably have to find communities but it’s not impossible. This works well if you work remotely, and honestly what are you doing inside a house anyway?

The real downside here is being away from the things you might like, like restaurants or shopping or hospitals or schools, but maybe that’s a thing you can do.

Option 4: Go to Thailand

It’s an example, but you can just go to a country where the money you saved up is worth a lot more, and buy a house there. This works well if you’re in an industry where the salary is more or less fixed no matter where in the world you work, and also if you have some familiarity with the nation in which you want to buy the house. NZ is another option, even though it’s still pretty expensive.

Option 5: Wait for the pop

We know the bubble will burst, and the immense spending by governments around the world due to covid is going to cause a wave of massive inflation, not to mention a huge number of people dying. That in turn is going to push house prices down. There are going to be opportunities out there, you just have to wait and keep an eye on it.

None of these are great

I know, but we’re hitting third or fourth order effects from a system that isn’t working. Change brings opportunity, and there’s plenty out there because of Covid and climate change looming. Just be open to moving around and finding a new place to put down roots. Good luck have fun.