How to Make Money Building a House the Bank Paid For (canada)

This is another archived post from a finance thread on 4chan.

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.

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.

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

https://www.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.

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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.

A Craigslist Venture

A Craigslist Venture

I’ve been taking the first steps into a home-based Craigslist selling business.

It’s bothered me for the past few years, that all my income is too removed from the reality of my life. My money flows in through a pipe between the US and Canadian economy, but what if something happens to the pipe? Or the companies on the other side of that pipe? Or the governments over here and over there?

I’ll consider myself more secure in my position if I can build a money generator over here, to supplement the one over there.

Since it’s my mission in life to produce the maximum possible with the barest minimum of input, I’ll be creating my Craigslist products using almost exclusively free inputs. Here’s a few of the products so far that I am trying.

Battery Banks

I’ve found a use for the 120+ lithium batteries I salvaged earlier in the year. My cost for each recovered cell is $0.90. Thrown into a $1.15 battery housing, and I have attractive power banks at about 2 bucks a pop. I can sell at $20 and still be the cheapest guy on Craigslist.

18650 battery pack

18650 battery pack 2 cell measurement
The ads are all up for these but I haven’t sold any yet. It’s possible I’m still charging too much, or the market is saturated. I’ll also experiment with my messaging. I’d rather not stoop to overpromising milliamp hours which is what my “competition” on Craigslist is doing.Jerusalem ArtichokesAn extremely productive crop that has a much higher selling price than potatoes. Typical prices at seed companies are 20$ for 6 or 7 tubers. If I can corner the market on these tubers in my city, it should represent a nice little cashflow with very little effort.

sunchoke - jerusalem artichoke

Red Wriggler Compost Worms

I paid 25$ for a half pound of these worms. These creatures have a doubling time of mere days. Therefor as long as I can supply them with enough biomass to support their exploding population, I can create money out of food waste just as fast.

red wrigglers - compost kit

My plan is to create “compost worm kits” with a 5 gallon bucket and sell those. I could probably ask 30$-40$ each. Total cost should be zero as long as I can keep getting my buckets for free.

With any of the above ideas, I’m prepared to create a website to sell the products through targeted to my area. Craigslist is more of a way to market test. I’ll also be able to mail everything out economically if needed.

How to Design a Community Garden

It’s only been two weeks since we moved in, but I’ve already been put in charge of designing community gardens at our co-op. I have a 7k Canadian peso budget and a copy of sketchup at my disposal.

After a few iterations, I have this.

Image

I’ve designed the different sized beds to appeal to different levels of competence. Gardeners just starting out can take a 4×4, and experienced gardeners who grow a lot can spread out into a 12×4. In addition, the 12x4s can be split in half to accommodate more gardeners.

Culinary herbs grow in the tall planter behind the bench.  Any resident of the co-op can take herbs from here. Its psychological ulterior motive is to trick residents into signing up for plot of their own.

Image

The Solar Audit

I came up with a method to design for the sun. In food gardening, sun hours is critical. Without sun, you can’t grow anything with calories in it.

Every hour on the hour, I took pictures of the area. Here it is at 11 AM.

Image

And here it is at 2 PM.

Image

By counting hours of sunlight in various places, I know what can grow where. I only put beds in the areas with a minimum of four hours.

Unfortunately, that’s still very little sunlight to work with. With the four and a half hours of sun we get on this part of the property. We can grow Broccoli, Peas, Beets and anything that’s a leaf – kale, salad and other rabbit food.

In my opinion, most people want a garden to grow tomatoes. And for tomatoes, six hours is bare minimum, and really you need eight for adequate results.

Here’s a chart Mother Earth News came up with that lists a number of low light plants that would still work here.

Crop Shade Notes Growing Tips
Arugula At least three to four hours of sun per day. Arugula welcomes shade, as this crop is prone to bolting as soon as the weather turns warm if in full sun.
Asian greens At least two hours of sun per day. Asian greens such as bok choi (also spelled “pac choi” and “pak choi”), komatsuna and tatsoi will grow wonderfully with a couple hours of sun plus some bright shade or ambient light.
Chard If you grow chard mainly for its crisp stalks, you will need at least five hours of sun per day; if you grow it mainly for the tender baby leaves, three to four hours of sun per day will be enough. Expect chard grown in partial sade to be quite a bit smaller than that grown in full sun. Baby chard leaves are excellent cooked or served raw in salads.
Culinary herbs At least three hours of sun per day. While many culinary herbs need full sun, chives, cilantro, garlic chives, golden marjoram, lemon balm, mint, oregano and parsley will usually perform well in shadier gardens.
Kale At least three to four hours of sun per day. You’ll notice only a small reduction in growth if comparing kale grown in partial shade with kale grown in full sun.
Lettuce At least three to four hours of sun per day. Lettuce is perfect for shadier gardens because the shade protects it from the sun’s heat, preventing it from bolting as quickly. Often, the shade can buy a few more weeks of harvesting time that you’d get from lettuce grown in full sun.
Mesclun One of the best crops for shady gardens. Grows in as little as two hours of sun per day and handles dappled shade well. The delicate leaves of this salad mix can be harvested in about four weeks, and as long as you leave the roots intact, you should be able to get at least three good harvests before you have to replant.
Mustard greens At least three hours of sun per day for baby mustard greens. Mustard grown for baby greens is best-suited for shady gardens.
Peas and beans At least four to five hours of sun. If growing these crops in partial shade, getting a good harvest wil take longer. Try bush and dwarf varieties rather than pole varieties.
Root vegetables At least four to five hours of sun per day for decent production. Beets, carrots, potatoes, radishes and turnips will do OK in partial shade, but you’ll have to wait longer for a full crop. The more light you have, the faster they’ll mature. Alternatively, you can harvest baby carrots or small new potatoes for a gourment treat that would cost an arm and a leg at a grocery store.
Scallions At least three hours of sun per day. This crop does well in partial shade throughout the growing season.
Spinach At least three to four hours of sun per day. Spinach welcomes shade, as it bolts easliy if in full sun. If you grow it specifically to harvest as baby spinach, you’ll be able to harvest for quite a while as long as you continue to harvest the outmost leaves of each plant.