The earlier this summer I chatted with Nora, of the Professional Hobo, about how my nomadic lifestyle was inspired by my parents. While most of my values come directly from my parents, there are a few areas where my views are the exact opposite of theirs.
I’m sure it doesn’t come as a shock that my mother, who taught German and Spanish, instilled a love of travel in my sister and me. We grew up hearing stories about her adventures backpacking around Europe and doing a working holiday. My dad traveled around the US for business, so whenever possible we’d go with him. He’s where I get my preference for taking the train (and talking to strangers).
Nora and I talked about how incredibly financially responsible my parents were. We were always comfortable growing up, but our family seemed pretty frugal compared to my friends’ families.
The area where my parents and I diverge the most is housing. When I was a baby, my parents bought a couple acres of land and built a modular home. Soon, they decided this three bedroom, two and a half bath home wasn’t enough for our family of four.
While it didn’t quite turn into the Winchester Mystery House, I ended up with three bedrooms and two bathrooms to myself. That’s right, I had two bathrooms. I turned one bedroom into an art studio and used the original master bedroom as my living room. Of course, we also had a family room and a formal living room. My dad’s home office was made of two bedrooms he combined into one room. My parents bathroom was the size of a Manhattan studio apartment.
To be fair, their house is the size of a typical McMansion. They paid off the mortgage early, before they built the addition. My dad built the addition himself, in his “spare” time. Having a flower farm meant they paid lower property taxes and we basically ate for free every summer from our vegetable garden. But even as a little kid it just seemed silly to have multiple rooms we only went into to dust.
Which worked out, because then I moved to New York, which is not exactly known for its affordability. For a while I sublet from a friend while she was studying abroad (which was the nicest place I’d live in for the next decade). Then I jumped from sublet to sublet, back in an era when that was cheaper than signing a lease. If you’ve only known a world with AirBnB, that may be difficult to imagine, but people used to be happy to get someone for weird short term stays, even if it didn’t cover the whole rent. It was better than leaving the room empty and covering the whole amount. My parents were theoretically commuting distance to Manhattan, so I always had a backup plan between sublets.
At a certain point, it was getting harder and harder to find cheap sublets. Each spot was deeper into Brooklyn, meaning I spent more and more of my life on the subway. And my willingness to endure tiny rooms with no AC and constantly being on the move was waning.
There was a significant gap between what I was able to pay and what I was willing to pay. Paying more in rent felt like a waste, while paying off a mortgage was something I could rationalize as a type of savings. Even if most of a mortgage payment went to interest, I could live with that.
I’d been carefully (okay, obsessively) socking away money for a downpayment. How much longer did I have to wait? I pulled up the New York Times real estate calculator and realized I already had more than I needed.
Which sounds a little ridiculous, I know. But people talk about owning a home in New York City as an unobtainable dream for anyone who’s not in the 1%. I was most certainly not in that category. I still don’t make very much money and I made even less back then. I just saved everything I could and figured I’d have to keep doing that for quite some time. Putting a real number on how much I needed to save seemed like it might scare me away from my goal, because it’d seem impossible.
Having a downpayment didn’t mean I could get a mortgage, though. This was during the recession and I’d spent most of my life as a freelancer. Also, did I mention that I make very little money? Thankfully, my mom agreed to loan me the money. Sure, it was at market rate and didn’t qualify for the mortgage interest tax deduction and my family will forever act like my mom bought it for me, but I was able to buy a one bedroom apartment in Brooklyn as a 26 year old making less than $40k a year.
I picked out my first apartment planning on dying in it. But I also made sure I could rent it and cover my expenses, if I needed to. Even in its current condition, which wasn’t great. It had been owned by an absentee landlord who had died and then been left vacant by the daughter who’d inherited it. The kitchen had three different types of cabinets, two types of kitchen counters, and the appliances were all broken or missing. Oh, and the bathtub was peach.
It was clear that everyone thought I was insane. Some people were impressed by the fact that I owned anything in New York, but perhaps it was better to own nothing. People politely smiled in the way they do when they’re struggling to come up with something nice to say. My little apartment was usually worth more than their suburban houses, but I kept that fact to myself.
While my friends in the suburbs were buying nice houses with their mortgages, I was living with a roommate so I could save up money for renovations. Then I was living in my apartment during the renovations, which is always an adventure.
If you look at it on paper, my ex and I both flipped our apartments. It didn’t feel like that, though. It felt more like being broken down by constant battles with co-op boards. Like all of my hopes and dreams for my life in New York being crushed.
The consolation prize, of course, was selling it for more than twice what I’d bought it for. I lived in it for two years, so I paid nothing on the capital gains.
By then we’d decided to immigrate to Canada so we could move to Toronto.
After some less than great AirBnB experiences, we crunched the numbers and realized it’d be the same cost to rent a place. Or, I could use the money from my apartment sale to buy a condo in downtown Toronto. We could get roommates to cover the carrying costs (which were low, since there was no mortgage). This way, we could split our time between Brooklyn and Toronto and the only additional costs would be our flights.
So that’s what we did. It was (mostly) great. Once we became permanent residents my wife sold her place in Brooklyn and we moved into my place in Toronto. This move had legal implications I hadn’t thought about, but that’s another story.
Before we’d settled on Toronto, we’d talked about doing more slow flips, where you live in a home for a few years while you renovate it. But doing it intentionally this time. This allows you to use the primary residence exemption to avoid capital gains taxes. However, the place I found in Toronto made this impossible.
The slow flip required moving every few years, but we had found a property that worked perfectly for us. We’d converted the den into a bedroom, so we each had our own home office. It was centrally located. Within a few months of buying it, prices in Toronto had risen to the point where there wasn’t going to be an opportunity to trade it for something comparable.
My condo, once again, seemed crazy to everyone we knew. I’d majorly traded up when we’d moved from Brooklyn to Toronto. Instead of being out in Brooklyn (and not a hip part) we were right downtown. We had central air, a dishwasher, and a washer and dryer. While we upgraded a few things, it had been nice to begin with.
That’s not how other people looked at it. If I could afford to buy this in cash, why wouldn’t I use it as a downpayment instead? Imagine what we could afford if my wife and I pooled our money and used that as a downpayment. We could buy whatever we wanted.
But what we wanted was simple: a comfortable apartment where we had our own spaces to work, room for guests, and a decent kitchen. And we wanted to have everything we needed close enough that getting on the subway was optional. I didn’t feel like I was missing out on anything.
Even with low living expenses, I really wanted to house hack. That’s when you buy a multi-family and the rent from the other units covers your living expenses. We were even willing to rent out our place and spend a few years in the suburbs or Hamilton to do it. However, prices in the GTA made that difficult and there was a lot of competition from other people looking to do the same. Our realtor accompanied us to some real horror shows, since that was what was within our budget.
In the end, my wife and I zeroed in on a few buildings as potential investment properties. We did a ton of research, so when a unit popped up for the right price, we made an offer, sight-unseen. We had a great time setting it up as a furnished rental. We put it on the market in December, which made for some stressful weeks of having no interest, but found a tenant right away once the holiday lull had passed.
When my parents split, my mom kept the house I grew up in for a few years before downsizing to a place that ‘only’ has three bedrooms. My sister and her family now live in our old house.
By this point my dad had also bought an investment property. The difference between our strategies is that he lives in a house that’s much nicer than his (still nice) rental. Our investment property was a little smaller than our home, but it was fancier, so they were worth about the same amount of money.
My family doesn’t give me a hard time about never upgrading from a ‘starter home.’ They’re not always quite sure what to make of me, but they seem to understand that whatever weirdo things I’m doing are putting me in a good financial position.
People who’ve never lived in a city will never take me seriously as a person because I don’t own a house and a car. They can’t quite wrap their brain around the idea that someone can own an apartment and that they can be worth a lot of money, even if they seem pretty modest. Or that someone can be perfectly content with “just” an apartment.
When we broke up, my ex bought the condo from me. I wasn’t sure if I wanted to buy a new place right away, since it seemed like I shouldn’t make any big decisions right away. But then an apartment came up for sale in one of the buildings we’d had our eye on. I jumped at it, since I’d already decided it was a place I’d be happy to live in and knew the numbers worked to rent it out.
My family might think my choices are a little weird, but both parents offered to loan me money in case the timing between the purchase and the sale didn’t line up. In the end there was no need for a bridge loan, but it was nice to know they would have been willing to do such a huge favor for me.
I settled into my new place. I had a ton of fun buying new kitchen stuff and deciding where everything should go.
I knew I wanted to spend part of the winter visiting my parents. Then a friend offered me her place in Montreal for a whole month. I decided to get a roommate to cover the costs.
Unfortunately, no one wanted to rent the room just for two months in the dead of a Toronto winter. I agreed to have my new roommate stay longer than I’d planned to be away. While my place is only a one bedroom, I host friends, family, and CouchSurfers often, so a space that could work as a second bedroom was essential. Of course, the agreement was predicated on my hardly ever being around. I’d tried to find house sitting gigs in the past, to no avail, but I decided to give it another go.
I set up a profile on Trusted House Sitters on the advice of a friend. Before I knew it, I had found sits for my extra time. If you ask my friends, they might say I extended my trip every time an email from THS popped into my inbox.
My ex and I had agreed to keep the investment property until the lease was up, but lucked out when our tenant had to break her lease because of work. I looked into buying her out, but when I submitted my application to our mortgage banker he didn’t even bother to email me back to say no. Thanks to Toronto’s rising market — and finding an under-valued property and giving it a face lift — we did pretty well, especially considering the short time we owned it.
The experience of getting the investment property ready to sell, actually selling it, and dealing with the furnishings while I was traveling in another country wasn’t totally smooth, but I was pretty impressed with myself (and grateful to my realtor and friends!) for getting it done. Add in handling some minor repairs in my apartment from afar and I was feeling comfortable with the idea that I didn’t need to be physically there to be a good landlord.
The only problem is that, without qualifying for a mortgage, I’m priced out of the two markets I know: Brooklyn and Toronto. Luckily, house sitting is a great way to get to know other cities. It’s also an incredible way to cut down on my living expenses.
I’d thought I couldn’t house hack without leaving Toronto. Maybe I can’t do a traditional house hack, where I buy a duplex or a house with a basement rental, but I can still live for free. I’ve spent quite a bit of time in Toronto this year, but I’ve been house sitting for almost all of it. Much to the relief of my roommate, I’m sure.
I’m sure it wasn’t a huge surprise to my parents when I said I was going to travel for a few months and then extended it to a year. This isn’t the first time that’s happened. It’s so easy to continue traveling once you’ve started.
My mom has always seemed to find me entertaining, even if I was doing something ridiculous (okay, especially if I was doing something ridiculous). I’ve taken her dumpster diving and CouchSurfing. After patiently listening to me during the very long phase where I wanted to live in a yurt, she’s probably just happy I’m staying in places with actual walls. She has no interest in pet sitting, but she’s happy I love it so much. I’m constantly sending her pictures of the critters I’m watching.
As a fellow weirdo, my dad is fascinated by my latest scheme to live for free. While I’m sure he’s relieved that the plan isn’t to just stay with him all the time, he’s happy that I visit more often. He loves helping me plan out the best train routes between sits.
They both love traveling, but have no desire to be nomadic. They’re deeply enmeshed in their community. I don’t think either of them will ever leave the area I grew up in. The more I travel, the more I appreciate the area they chose to make their home in. We might not always agree, but I think we understand each other.
