How to make money building a house that the bank paid for

I'm tired of seeing people posting that "mortgages are just the bank fucking you" and "owning property is letting the jews win" 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.
Two sets of stairs mean basement tenants never have to enter your actual house; they access the basement from the garage

Other urls found in this thread:

cibc.com/ca/mortgages/calculator/mortgage-payment.htm
resist.com/CWII.pdf
twitter.com/NSFWRedditGif

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.

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 $300k.

That's $110k 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.

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
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. Paying a brand new house off in 10 years is not fucking common for young people to accomplish. If you can manage to get the bank to loan you the money when you're 20, you could own the house in full by the time you are 30. That's nuts.

Boomer detected
KYS faggot

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.
You own a house that can be sold for $300,000+ 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. My municipality just raised my property taxes and my house was appraised at $400,000+. You can make a lot of money doing this if you do it properly.

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.

You might want to read the posts

Have another sa(g)e boomer

I'm 28

Again. FUCK OFF

Do you mind if I save this and post on wider internet?

Go for it brother. I'm just trying to help people out.

...

bro. don't let the cunts get to you, I really appreciate you lining this all up.

Me, I'm in Vancouver and I don't think I'm going to pick up a lot for 50k - what part of the country are you in?

I run a finance blog and I want to put up your post. I put up a step-by-step guide to craigslist business from /biz/ that does really well and I think yours could do.

I don't think you read that post

I posted it on /biz/ too. And no problem at all man, I'm glad to help.

I live in rural Ontario, so obviously the price of the lot isn't going to be anywhere near what yours will be if you live in or near the city. Acquiring the lot is definitely the hardest part of doing all this, and I'd recommend getting away from the city if you can manage it. A longer drive to work and more money spent on gas is worth the ~$300k you would save in the cost of the lot, in my opinion.

So do you hire a general contractor or do all that stuff yourself? If you wrangle tradesguys yourself, how many hours are you putting in? Sure you net 55k over 2 years, but if you have to put in full time hours, it's just like having another job working for the bank in a sense right?

"Hey hey goyim, you know a little too much. Why don't you start loaning/renting as well and now we can both be shekel hoarding chosens?"

No no, I've read it. I guess my point is to beat the jew you must become the jew.

>50k for a lot

I'd recommend you hire a general contractor, which is included in the total price of the build.

A GC manages all of the trades for you, and you coordinate primarily with them only. They'll often have floorplans that are sort of pre-canned and they are already good at building them, and some will allow you to make whatever changes you want, at a cost of course.

Now, I personally did some of the work myself because I work in trades and I have those connections. I coordinated the electrical and the HVAC stuff getting done myself and let the GC do everything else. All that means is that I was able to spend more money on other things that I personally wanted, like an ICF foundation for better insulation etc.

I didn't put many hours in myself, it was mostly just phone calls and the occasional meeting after work. If you have a general knowledge of construction and you were willing to really slave your bag off, you could definitely save a lot of money by doing the work yourself. In that sense, yes it would be like having another job, but you could cut into that total cost quite a bit.

where do you live

Thanks for bringing thid angle on development to my attention. Seems to be worth keeping in mind.

no problem brother

If you don't mind the idea of having a couple living in your basement, it's definitely worth keeping in mind

>50k for a lot
>a lot
>1 lot

STOP FUCKING SHOWING THEM TEXAS LAND PRICES YOU FUCK

tl;dr Build a new house on builders mortgage that will cost less to build than market value for similar home when complete, rent basement out to cover monthly mortgage payments, and sell for profit or continue living w/o paying out of pocket

oh you were implying that was too much lol

and also if you rent the basement out you can also hold yourself responsible to still make the mortgage payment yourself and pay off the mortgage twice as fast

Based TX. I bought 14 acres in the country for under $75k, just started construction on our house yesterday. Feels good man
Its ok just Beaumont.

Michigan is fucking ridiculous as well.

I might move there when I'm older.

Kek
It's nigger town so calm down

I understand what you're trying to do but it doesn't work quite like. You have to be your own contractor to cut costs down. That's the only way to do what you are saying and to actually make a profit.

Very few people can build their own house, and for those who can that I know who have done this the profits are marginal.

Looks good dude.

This is totally viable for a lot of people, you just can't really do it in the city for obvious reasons.

>You have to be your own contractor to cut costs down. That's the only way to do what you are saying and to actually make a profit.

lol what?

A GC gives you the total price to build the house that you've designed with him and he takes a cut for himself, that's how GC's make money. You don't have to be your own contractor at all, it's still cheaper than buying a house outright.
>and for those who can that I know who have done this the profits are marginal.
sounds like you hang out with idiots

But I live in an area that places massive fees and taxes on any new construction (this is mostly a way to squeeze Developers for more money)

Also that area is in South Florida where we don't have basements

>there's no way to make money in real estate development

>50k for a lot

That's acreage prices around here.

I had fees and taxes on my build too. My permits alone were close to 10% of the total cost.

Good, country homes are more comfy

A GC charges you, he makes a profit off of it, tens of thousands of dollars. Why not save that and make more profit?

read
I know how hiring a GC works dude. I did it.

If you want to save tens of thousand of dollars by doing tons of work then go ahead. Everyone knows you can work hard to make more money.

This is pasta from /biz/
It's not remotely possible for the average person

How does this work in murica mr. Hat?

you have to pay taxes on the rent they give you and are responsible for all the repairs you retard.

This too.
Unless you sell it outright you'll lose shitloads.

My wife and I make 80k a year with our easy jobs and rent is $600 a month. We'd lose money over time with this. This only works if you have no job or income and are sitting on 100k. Literal fantasy

Even if you sell it outright you will have to pay taxes on the money you got by selling it, not to forget that you even have to pay taxes when starting to build in the first place.

Maybe it works like that in leaf land, but most banks in the states will only lend up to 75% on the lot and it will be at a higher rate. Also, you need 20% on the building loan or get ass raped with PMI. You will also have several thousand in closing costs and need 6 months of reserves.

I'm guessing you don't have the proper permits to rent out the basement units either, opening you to a lot of liability. You could get fined by the local zoning board, you are probably in violation of your mortgage, and dealing with tenants is a pain in the ass. Plus you need to keep it occupied all the time which can be difficult. Since living in a basement is less than ideal for most, you will have to charge below market rents unless there is a shortage of rental units.

Also, it is unlikely that you will be able to sell for more than the build price within the first few years. Your home was built to suit your tastes that a purchaser is unlikely to share. In this case, the customized basement that was rented out.

Your plan to out jew the jew is risky and probably won't work as well as you hoped.

t. Banker

Is this able to work for England, mate? This could be hella good if it work over here.

I am doing this once I am done with school. Not Texas though. How big of a house are you planning on building? What are the costs? The areas I am hoping to live in I can get about 5-10 acres for 30-60k sometimes even more acreage for less. The one thing I wonder about is how much would it cost to ensure my house is connected to the grid if I am out in the stix?

Not bad OP, not bad at all...

Fuck off

>You might want to read the posts

I did. Your advice is fucking suicidal.

Most housing markets aren't like Canada, with a guaranteed 50k profit for building a house, a 300k average sale price, etc.

There's also a ton more dick pain associated with (especially college!) tenants than most homeowners know, or are prepared to deal with.

This is shit-tier advice, for Canadian leaf posters only.

not where I'm from this shit is gold

see and

Where are you putting it? I was thinking the same but never mind if it's duplicate content.

Are you from Ottawa? I had a highschool teacher tell us to do this exact thing

Building a 2300 sq ft one-story house. Not that much extra cost to living in the country. It cost a couple grand to have power/water run to our land. We also have to put in a septic system and I'm making sure we get a backup generator that can run the whole house off propane.

This.

There are multiple problems with every part of this leaf's monologue. He acts like he's giving us a primer on real estate but it's the worst advice I've seen in years, even for this site. If anything his advice enslaves people to the bank. He acts like the bank does all the work, frankly this sounds like a mortgage pitch to subprime buyers. Try to tell the goyim that they can 'rent out their basement' for passive income sounds like Joe Biden telling us to 'fire a warning shot with your shotgun' to scare burglars. This thread is fucking retarded.

The bank doesn't give you all the money up front, and only pays out incrementally, thus the bank is not building the house. The bank is not paying you to build the house. You are building it and you are paying for it, and if you can't meet the schedule the bank will take your whole lot and never give you back the $100,000 you invested out of your own pocket. The idea of building a home, living in it for two years then selling it, is the fucking pyramid scheme to beat all pyramid schemes.

If a bank or real estate agency can convince a demographic to do this, then the homeowner builds the home. The homeowner pays the mortgage. The homeowner makes property value investments. The homeowner manages the property and maintains it. The best part about it is that an entire community of people doing this will trade lots for decades without actually making money; they just think they are making money but the money is tied up in assets that take years to liquidate without taking a loss. These people create the supply and demand, they build the houses, they trade them, all while the bankers skim off thd top. Look at it this way, if you want to fuck over the kike credit system and the kike bankers, don't get a mortgage. Instead of taking $50k for expenses, $75k in builders mortgage down payment, $70k for the empty lot JUST TAKE THAT MONEY AND BUILD A HOUSE WITHOUT A MORTGAGE WHAT THE FUCK IS WRONG WITH YOU?!?! Do you go to Sears and tell them that if they give you a blacksmith's mortgage you will forge your own tools and pay them back, then spend thousands of dollars paying back that loan? ALL OF MY WHAT THE FUCKERY HOW CAN LEAFS BE THIS RETARDED

OP is the worst banking shill I have ever fucking seen.

>tl;dr Build a new house on builders mortgage that will cost less to build than market value for similar home when complete, rent basement out to cover monthly mortgage payments, and sell for profit or continue living w/o paying out of pocket
So, you've got to live (and be able to make a living) in an area where the land is cheap, and honest, reliable contractors are readily available to build a new house for less than the difference in cost between land and houses, and not only are renters eager to move into a basement at the cost of mortgage payments on a new house, but buyers are just lining up to pay full price for used houses not built to their specific preferences (in a place, remember, with cheap land and good contractors), and which have had renters living in the basement (who, incidentally, you have no trouble evicting to make the sale). And somehow, no big-money developer has come in to build whole neighborhoods at once.

What I'm looking at here is a leveraged investment involving much more work than you expect and many possibilities for your costs to increase, and if too many other people have the same idea at the same time, you're fucked.

People don't actually make money doing this kind of shit unless they get very lucky. This kind of brilliant plan tends to end in taking credit card cash advances to make mortage payments.

how many houses can you build on 5 acres? do you need special planning permissions?

>t. Banker
would yo uadvise creating unredeemable negotiable instruments as pecified in the bill of exchange act?, or UCC 3

>50k for a lot
>a lot
>1 lot
>STOP FUCKING SHOWING THEM TEXAS LAND PRICES YOU FUCK

2 acres in the city limits of Austin = $300,000

>People don't actually make money doing this kind of shit unless they get very lucky. This kind of brilliant plan tends to end in taking credit card cash advances to make mortgage payments.

The best part is that these same people will try to leverage a second property in order to cut their losses, thinking the new asset won't depreciate like the old one. These people bounce from house to house going deeper in debt until finally they have to steal identities and illegally rent out the foreclosed properties to make ends meet. These people are usually boomers and are literally a walking meme.

If you want to get into real estate for the purpose of income generation then you have to stop trading in man hours. You need to be trading in asset units that have the highest value you can afford to trade in, and you need to trade those asset units as frequently as possible. A house you can't afford to build or pay off is not such a asset. Although a house is a asset with hundreds of thousands of dollars in value, you need it. You can't carry five of them in your pocket each day and sell them at your leisure, they are not disposable enough. It also takes years to sell that asset at a good price, this is too low in frequency.

A better asset would be cars, because at $500-$50,000 avg you can buy a lot of them and move them fast. You could make millions running a junkyard in the two years it would take to build a home and pump it's value, because in that same timeframe you would have moved thousands of cars. Just an example. With a house you are trading on man hours, which is not profitable.

Thanks OP for not sucking!

What if I own the lot already? Will the bank still only finance the first 40%?

>Find a decent vacant lot for ~$50k.

go fuck yourself.

I recognize this stale old pasta from /biz/
And also I recognize the obama shill
get a real job

isn't texas already minority White?

how will demographics progress, given current trends?

You don't pay tax on selling the house in Canada if you live in it for two years before selling.
You just put it all right in your pocket, GTFO shill.

>My wife and I make 80k a year with our easy jobs and rent is $600 a month. We'd lose money over time with this.
lol what? how on earth would you lose money?

The bank pays you increments based on the percentage of construction that is completed. They give you a rubric of how much each step is worth towards total completion. For example, the plumbing roughed in might be worth 4% or something like that.
You are not paying for it. The first draw I got from the bank was $80,000. They give you a chunk of money and they say "okay, this has to get your build to 30%". You give that money to the GC who is completely fine with the stages of completion because you worked that out with him before you started building.
You just sound like a retard who has never touched a wrench in his life to be honest. Lots of people rent out basements or rooms in their homes for additional income. Lots of people build houses and then sell them.

>what are security deposits?
>Taxes are 100%

Look, I understand they do things differently in Germanistan with the whole square footage rent shit and that thing about dividing walls costing more, but unless you rent to meth heads, pay your homeowners insurance, and more importantly, require your tenants to have renters insurance (like $10 a month at best, you can knock it out the rent fee if you like), OP's barking up the right tree.

ITT: how to give banks lots money for absolutely no risk

>What if I own the lot already? Will the bank still only finance the first 40%?

They will still only finance the first 40%, yes

>A better asset would be cars, because at $500-$50,000 avg you can buy a lot of them and move them fast. You could make millions running a junkyard in the two years it would take to build a home and pump it's value, because in that same timeframe you would have moved thousands of cars. Just an example. With a house you are trading on man hours, which is not profitable.

sure if you don't mind living in a junkyard for two years instead of a new house

and if you want to own a junkyard, instead of a new house

No, I'm not. Your high school teacher was smart though.
>a 300k average sale price, etc.
the average cost of a house in Canada is likw 500k

>There's also a ton more dick pain associated with (especially college!) tenants than most homeowners know, or are prepared to deal with.
There can be, but there's a lot less on new builds because everything is brand new. New shit doesn't break as much as old shit, surprise dude mind blown.
And yeah, you obviously have to choose your tenants wisely.

>isn't texas already minority White?
No its not. Also its fine if you stay away from the large cities. The town I'm building my house in has a population of about 5k and is over 75% white. It will be good for a long time.

would you agree that texas has a higher than average taco population? being a mexican border state

and that Whites are already a minority in the US as a whole in the under 6 category?

doesn't that make it likely that the border states are much more beany?

>how many houses can you build on 5 acres?

probably 10+

>JUST TAKE THAT MONEY AND BUILD A HOUSE WITHOUT A MORTGAGE WHAT THE FUCK IS WRONG WITH YOU?!?!

you don't seem very bright

resist.com/CWII.pdf

pretty good read

The Mexicans here are nice at least. Usually. But there are some and areas...feel safer in a Mexican ghetto than a black one though

doesn't matter how nice they are once the war starts

if you were invading a country by stealth and by playing on their morality, wouldn't you pretend to be nice? until you were a majority at least

>New shit doesn't break as much as old shit
Old shit doesn't surprise you with defects as much as new shit.

Bathtub model: you find a lot of defects in brand new things, and then stuff breaks down at the end of its life. The period of reliability with a low level of random failures and defect unmaskings is in the middle. Except houses are built to be maintained, so wear-outs are easier to deal with than fundamental defects.

This is why you have an easier time finding buyers of houses that people have been living in for a few years. Someone else has dealt with all the possibilities of crooked or incompetent contractors, and lived with all the nasty surprises that popped up as the seasons passed. Inspections will show any mold, moisture, rot that takes time to appear. Badly built things will crack and heave, and so on.

A new house is full of risks, and building a house is even riskier.

yeah well brand new houses cost more than used houses so I'm going to go ahead and say that the market disagrees with you dude

housing market is a scam

>brand new houses cost more than used houses
They need to be priced higher, and I think you'll find that many of the buyers of brand new, non-custom houses are speculators.

A custom house, built exactly as you want it, is a luxury item. People will bear a lot of risk and expense to have a house tailor-made to their wishes.

I can get a decent lot for 25k Dorrah.
Thing is, nobody will fucking rent a house from you in Eastern Eurostan, especially if it still costs them to get to their city jobs/schools. College kids rather save up to actually buy an apartment in the inner city near the college, than keep commuting in from one cheaper shithole down the road.

BTW, in more rural places every city and town has already calculated the price of an educational centre into either their land prices or the local legislation regarding the tax for offering an apartment for rent. And the private land sector is just off its tits, expecting extortionate prices for their crummy inheritences.

Creative advice though, at least it's something creative on Sup Forums. Even if it is pasta.

>tfw in Michigan

please stop sharing this information

I personally don't think it's difficult to rent out a brand new, very large basement apartment, but to each his own I guess. I never even mentioned selling the house.

I understand that it's a luxury item. That's why people are so surprised to learn about how feasible this is for a lot of people that are either looking to mortgage an older home or start renting.

It's pasta that I personally made lol

and yeah I have no idea how fucky europe is, sorry dude.

>I'm tired of seeing people posting that "mortgages are just the bank fucking you" and "owning property is letting the jews win" and all this shit.

only underage faggots who live with their parents believe this.

pic related.

My commute in an apartment renting at $1100 is 15 minutes. It would be close to an hour to find something affordable to own otherwise. Shit sucks...I could always change my work schedule and come in at 9 or 6 am but fuck.

If you want to turn people off your state just tell them about your property tax.

Close to an hour isn't that bad.

> Shit sucks...I could always change my work schedule and come in at 9 or 6 am but fuck.
9am?

What a fucking ingrate. Guy's teaching you bro-tier how to make money instead of having to settle for being an edgy NEET.

I'm gen X and wish I'd been smarter w/my money the first time I got a decent job. I had to figure out what OP is talking about on my own.

He just saved you ten years.

Thank the man.

>1700sqft
>230k

Holy shit hahahahaha my 2850sqft house cost me 160k and it was in an amazing WHITE suburban area

U got fucking ripped off, maple faggot

Ye, 9 am to avoid the 7 - 8 am rush hour. Houston life. I don't mind actually driving but just sitting in traffic kills me

top kek
OP proxying to get himself some backing in his bank shilling

NOBODY LIKES SITTING IN TRAFFIC YOU LITERAL RETARD