Tentmaking Tips

I shared in a recent blog post, A Closer Look at Our Latest House Hack, that we recently finished renovating our single-car garage into a guest house. We were planning to use it for family, friends, & guests on Airbnb.

In our first 2 stays on Airbnb, we had a 30-day and a 31-day booking. In each of those stays, we made almost double what we made per month in our previous Airbnb. We were hoping to continue the 30-day booking streak when the Lord put something in our path we couldn't ignore.

We received an email from a campus ministry informing us that the university near our house was planning to scholarship 5 Afghan girls to come to college here & finish their education. These girls were in the middle of a degree plan in Afghanistan but had to flee the country when the Taliban took control in August 2021. They knew that the opportunity for women to get an educ

I often joke that unless the home is older than 1970, my wife probably won't like it. Haha!

She'd tell you that older homes have a certain character and build quality that is hard to replicate in newer homes (especially with the increasing cost of lumber). This is obviously an opinion & very subjective! ;)

That's led to us living in many different older homes over the years.

And these older homes have really accelerated our financial goals.

I want to share some reasons why older homes can be advantageous if you're looking to supplement your income.

1. Older homes give you the ability to "force" appreciation

   I'm using a term here that's more common in commercial real estate but applies here as well. Normal appreciation is the 3-5% (on average) that your home may increase in value each year. Forced appreciation is when you accelerate the appreciation by making changes to the house that increase its value quickly (like updating a kitchen or

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Forgive me for stating the obvious, but you wouldn't believe how many people leave money on the table when they go to sell their home. And I'm not talking a few dollars here and there. I'm telling you people leave thousands on the table, that could be theirs, when they sell their home.

I don't want that to happen to you. Next time you sell your home, I want to help you get top dollar for it.

My wife and I have sold many homes at top of the market value, sometimes even over market. We've had houses under-appraise on several occasions. That means the appraiser doesn't even think it's worth what someone is willing to pay us.

Here are the 5 items you need to focus on to sell for top dollar:

1. Remodel the areas of your home that are in need of being updated

   People don't want to pay top dollar for a home that doesn't look top dollar. That doesn't mean you need to spend

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I talked about the “living nearly free” part in a recent post entitled "A Closer Look at Our Latest House Hack."

Now let’s talk about the “making extra money” part.

How awesome would it be for your home to generate income for you and your family?

Well, that’s what our home has done for us over the years. Each time it made us money, we kept putting all the extra money toward our mortgage until we eventually paid off our house. You can read more in the article "How to Pay Off Your Mortgage in 6 Years."

One way your house can make you a chunk of money every few years is by doing Live-In Flips.

What’s a Live-In Flip?

Pretty much exactly like it sounds. You buy a house in need of work and you flip it while you live in it. Then you eventually sell it for a big, tax free profit!

If you buy a house, live in it at least 2 years, then sell it, the IRS lets you take that profit tax free (up to $500k

Well, I’ve got good news! There are other alternatives that can save you potentially thousands of dollars, even tens of thousands of dollars. Remember, Realtors make money as a percentage of your purchase price (often 6%), which can add up fast.

Here are a few of your other options:

1. Consult with a family member or friend who has done a FSBO transaction before. They can guide you through the process.

2. Call a local Title Company and they'll be glad to help because they make money when they close the transaction. They'll often give you the standard forms to use along with some tips on which sections to pay attention to.

3. If you want to spend a few hundred bucks to make sure everything is exactly right (which I recommend
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One of the reasons we chose this home is because we knew we could live here for free.

You're probably thinking, "What?!?!"

I'm talking about House Hacking.

House Hacking is essentially using your house to make extra money & live nearly free.

I'll share some about the "living nearly free" part in this post.

When we were looking for a house, we knew we wanted to find a place that had a detached garage or storage building that we could convert into habitable space to use as a short-term rental.

We also wanted to make sure it was located in an area where people would be looking for a place to rent, like near a university.

The house we found was a historic house built around 1920 (my wife loves historic homes). It had a detached single-car garage in the back and it was one block from a major university.

We knew that over time we could convert the garage, and through a service like Airbnb, begin to host guests & make extra money e

You'll get a better deal on your next house if you bypass Realtors and buy off-market.

That's going to be controversial with your Realtor friends, but I'm here to help you make more money to support your ministry, so I'm going to shoot straight with you.

Now, let me back up. I love Realtors - ha! I'm married to one! I also have a real estate license! My wife is actually a broker (a supervisor of Realtors) and we own a real estate brokerage where Realtors work. I even help those in ministry to become Realtors to make extra income. I'm not against Realtors - LOL!

I'm great with you becoming a Realtor, I'm just encouraging you not to use one to buy your house! Ha!

Here's why:

Realtors are very expensive. I mean, very. They usually get 6% of a transaction. You can do the math. It's a lot of money, especially on more expensive houses.

And when the Seller of a home is determining their list price, guess what they're factoring in? That 6%. Meaning, they'd sell for

You make your money when you buy.

What does that even mean?

It means that the price you pay for the house is the best indicator of your future return on investment.

Many house flippers have learned this lesson the hard way. What looks easy on HGTV can be very difficult in real life.

Regardless of how good your remodel is or how tasteful your decorations are, if you didn’t buy the house right, you could end up making very little money, or even worse, you could lose a lot of money!

An example:

• Mr. Flipper buys a house on the market using a real estate agent who tells them they are getting a good price.

• Mr. Flipper begins the remodel and after he takes up the floors, he sees issues with the foundation that will require extra money.

• Mr. Flipper tried to save some money by doing some of the project DIY and spends nights/weekends painting, laying tile, and installing cabinets.

1. Mortgage payment (principal + interest)

2. Property Taxes

3. Homeowners Insurance

#2 & #3 are often rolled into your mortgage payment and escrowed for you until they are due.

Chances are these 3 together are anywhere from $1,000-$2,000/mo, depending on where you live and how much of a loan you took out to buy your house.

Can you imagine if that $1k-2k/mo payment was reduced to nearly $0/mo? Life-changing, right? I’m sure you can think of some other things you’d like to do with that money each month.

The solution: House Hacking

In other words, use/hack your house to earn the extra income needed to pay for your primary housing expenses. Or move to a house that can generate the extra income.

There are many creative ways to do this. Here are a some examples:

• Convert the storage building in your backyard to habitable space and rent it on Airbnb.

• Build a tiny home in your backyard and use Zillow to lease it full-ti
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You can pay off your mortgage fast, in as little as 6 years. Maybe even in 4 years if your mortgage is less than average.

I know because we paid off ours quickly! We paid off our mortgage in our early 30s. And we weren’t living in a super cheap house either.

A median priced home in our area is $135k. Ours was $250k. We’re in a part of the country where $250k buys you a really nice, above average home. I recognize that’s not the case everywhere.

Anyhow, you can pay off your mortgage quickly if you’ll do one simple thing.

Move.

Yep, you need to move. 2-3 times in those 6 years to be exact.

Huh?

You see, the IRS wants to give you a gift. I know it’s hard to believe. If you’ll buy a home, and live in it at least 2 years as your primary residence, you can sell it after 2 years and take up to $500k profit tax free for married couples. Did you hear the key words there? TAX FREE!

Are you kidding?!?!? Nope, it’s true (IRS Publication 523).

Here are the steps: