Homeowners Revisited: Buying your first Home and what we wish we knew

This is episode number 138 of The Homeowner Show. Whether you're DIY or looking to hire, we're here to help you find the best information and options for you and your home. My name is Kevin Hackett, and here with me is Craig Williams.

Hello, hello, hello, and welcome to The Homeowner Show. We're glad that you could join us for this— I know what it's— it's a late night edition of the show, Kev.

Dude, it's super late.

It's The Homeowner Show at night.

Yeah. I mean, we've, let's be honest, we've done some late night stuff before. We, we could have started an hour and a half ago, and yet here we are just starting for the first time.

Oh yeah. So like, we, we've, we've done some upgrades to the studio. We got some, we got some new mics rocking. We got some new gear rocking.

Yeah.

Which is great because I was just able to take away the bumpity bumps without actually having to cut out the bumpity bumps. So, um, I'm, I'm, I'm feeling particularly giddy about, about everything right now.

Well, you should be because that, that's one of the things that I think the, the people that, that know us well, uh-huh, I, I think they probably bet on us secretly.

Like, are we gonna get the bumpity bumps this week?

Which one are we gonna get? Bumpity bumps or no bumpity bumps?

It's a fun drinking game.

Yeah, no, it definitely is because 'Cause you never know.

You never know.

It's, it's, it could be one or it could be the other.

Yeah. So, so I, I, I, I, I was gonna— I didn't tell you about this earlier. I made a fun upgrade to my home, uh, today.

Okay.

Yeah. So you know the house.

Yeah.

How—

Well, it's, it's weird.

It's weird.

Yeah, it just is.

So one of the, one of the, like, we have one area of the house where we can watch TV.

Yes. Basically the first floor. The first floor.

Yeah. So, which is a struggle because sometimes the wife and I have things that we want to watch and there's these annoying other people that live in the house with us.

They're called children.

Yes.

Yeah.

And they don't like to watch the things that we want to watch and/or they want to use the TV when we want to use the TV, which is not that often.

Right.

We're not big TV people, but we have a second TV and it, but just The way it worked out, it ended up in the same room, which was just dysfunctional.

So you basically have 2 TVs in the same room.

Right.

Poor choice.

Yeah. So we didn't want a TV upstairs, basically because there's not a place to put it. But there's been 3 or 4 occasions now where my wife has said, man, I really wish we had a TV upstairs so that we could go send the kids, they can watch whatever they want. We can stand out here and we can watch our shows.

Right.

So what I did is I got this cool roller cart for the TV.

Like an old school church cart?

No.

Oh, okay.

It's like a pole, and then at the bottom, it's a wide base with wheels on it.

Okay.

And it's a smart TV, so it's like you don't need anything else other than that TV.

Right.

So all we do is we've got an extension cord hidden underneath one of the bookshelves. pull that out, plug the TV in, they can watch whatever they want. When we're done, unplug it, roll it in the closet, boom, living room looks like normal again.

Craig, Craig, here's the problem. You're, you're way too logical right now.

Uh-huh.

Like, I, I don't think enough people in the world are logical enough to do what you just did, which is like bring something out when you want it, hide it when you don't.

Yeah. It's perfect.

It's—

yeah. And if you, if you know what my living room looks like upstairs, yeah, it makes perfect sense to do that.

Well, yeah, because you've got in, in the upstairs, you've got the second floor and the second and a half floor and the third floor all exposed, right? So you got to kind of figure out what you want to do.

Well, and if you want, like, the more people you have, you can— this one, you can actually like raise it up like, I think, 12 inches.

Okay.

Like, you can— yeah, it has a lot of capability.

It's— yeah, it's multi-purpose.

Yes. Okay.

And multifunctional.

Can I mean, it's not that big of a TV, but like, you know, a lot of people could gather around.

Okay. Are we talking like a 13-inch TV? Are we talking like a 32-inch TV?

No, it's like a 36-inch TV.

Oh.

Yeah.

Okay.

Yeah, it's big enough for the kids. That's all they need. We get Big Bertha downstairs.

Oh, yeah. Oh, yeah. Cool.

Yeah. So we, we have, we have our first, like, in-studio guest for, like, a while now.

Yeah. Because we've done a lot of, we've done, done a lot of remote things, which, don't get me wrong, has been fantastic because we've been, we've actually had a lot of really cool guests on our show that if, if we tried to do that in, in person, it just would've been impossible. We, we wouldn't have been able to. Right.

We're not going to Arkansas.

No.

Well, not for the show.

Who wants to go to Arkansas?

Well, I do.

I lived there for 10 years. It's actually awesome.

So, but like, our guest today, I, I hear, is like your friend.

Yeah, so, uh, guest today has been my friend for a while.

Uh-huh.

Yeah, so, um, I was 6 when I met— when I met this guy.

Okay.

Yeah, so he lived across the street from me, and, uh, he and I have been, uh, well, we've been best friends ever since then.

So, okay.

Yeah, so since I was— there's— I, I'll just tell you this, like I think there's a lot of people who have best friends. They've been best friends for a long time or whatever. I don't know very many people who've been best friends since they were 6.

Yeah, that's true.

That's a long time, depending on how old you are.

If you're 7.

Right. Yeah, exactly. But no.

But also, if you're 7, why are you listening to this show?

Something has gone bad.

Yeah.

If that's happened. So, yeah. So today, something weird kind of happened. So I have kind of a big birthday coming up on Monday, which is a day before this show is actually airing.

So everyone can send you the birthday notifications.

That's right. Yeah, go ahead and do that. That would be fantastic.

Yeah, just light it up on Facebook. It'll be glorious.

Exactly. So I've got kind of a big birthday, apparently.

By big birthday, you mean you're old.

Yes, apparently the over-the-hill point. Right.

So got a big box because the pen's coming for you, buddy.

Whatever. So anyway, so my wife has been— she's apparently been planning for a while. And you've been part of this.

Have I?

On some level, I think.

I was told to play coy.

Well, coy you've been. So anyway, she told me this afternoon, she was like, hey, Your stupid dog has been tearing up the yard again. He's been digging— she's been digging holes back there. So have you even seen what's going on back there? And I was like, no, what's going on? So I, you know, just instinctively walk back there. I walk back there and, uh, Eric shows up. So anyway, Eric, uh, Eric and I have been friends for a very, very long time, um, since we were— I was 6, he was 7. He's a year older than me. But anyway, um, So he's here, and you and I already had a podcast planned. I was like, let's just do this.

Yeah.

Right. So here we are.

Welcome to the show, Eric.

Thanks. Thanks. I appreciate it.

So best friends?

Yeah. I mean, Kevin likes to say that. Really, he would tell you Kimberly is his best friend. So I come in a close second, but I did deliver her wedding band via a remote-controlled Ford Mustang down the aisle at the their church where they got married, which happened to also be the car Kevin drove at the time. So, yeah, this is— I'm not going to lie.

I'm not going to lie. This is one of the coolest things that's ever happened to me. So Eric was actually not my best man. But I was only because—

in spirit. Yeah.

Only because I had a brother. Right. Does Brian listen to this? No.

Okay, good. I had legal obligations.

Exactly. So my brother was my best man, and honestly, my brother and I are very close. But Eric and I have been very close for a long time.

You didn't choose Brian.

It's true.

Yeah, it was given to you.

So at the time that it was time to bring the ring out, right, Eric, very coy-like, since we're using that word, brings out a remote control. And this is a long aisle. We're not talking about a short aisle at this church. This aisle is probably 100 feet long. And he expertly drives this remote control car.

Only almost wrecked it once. Drove it under an aisle, but masterfully backed it out.

Yeah, it was pretty perfect.

And skidded it to a stop right at the end. Just swerve at the stop.

I don't know how you did that.

I'm a great RC driver. That was introduced at an early age.

The Richard Petty of RC.

Honed my skills. So endearing, uh, your dear wife to me at an early, early phase.

Now, what was the most impressive thing? And I don't think this was planned. I think it just happened to be as soon as he skidded this thing to a stop, the hood pops open and it just so happened the ring was inside where like the engine compartment would be. And, um, yeah, slid to a stop, turned, opened up, the ring was right there, perfect.

That—

I don't know how you could have planned that any differently.

No, and I don't know any other way where Kimberly would have been happy with what we did because it truly brought her wedding to a standstill of everyone hoping and praying that I would not crash this car coming down the aisle delivering a very beautiful ring.

What's really fun— it was beautiful. It's beautiful.

You chose it.

What's, what's— yeah, what's really pretty funny is that that wasn't even the beginning. The beginning of it started off with Cracker Jacks. Everybody pulled out Cracker Jacks.

That was Brian's idea.

Yeah, that was Brian's idea. So anyway, Eric and I've been friends for a long, long time, but as he showed up randomly on my back porch this morning— this afternoon, sorry. Anyway, he showed up and I was shocked and surprised and it was awesome. That being said, we had this podcast planned.

Yeah.

And so I was like, look, he's here. And honestly, he's done quite a few things involving real estate and flipping houses and those kind of stuff.

And I was like, listen, let's just talk to this guy.

He's here. We don't get this opportunity very often. So here he is. And we're going to talk to him a little bit about that.

Yeah. But before we do that, I have, I have some questions first.

Okay.

So, uh, best friend status, right? You want to fight for him?

I can do that.

Okay. I feel like you don't know him that well then.

I know, I know. See, here's the irony. I know a version of Kevin.

See, because, like, look at him. This is a face that only a mother could love.

I agree.

But I've met his mom.

He can't fight for himself. So I've met his mom, and I'm not convinced that even she I think his dad has strong feelings for him.

Yeah, that's probably true. I don't know that they're like warm fuzzy feelings.

No, no, but they're paternal instincts nonetheless.

And like, okay, so like, it's his birthday. We gotta pick on him.

I would do it.

Okay.

No one is better at picking on Kevin than me. You picked the right person if that's what you wanna do right now.

All right. I'm feeling better about you already.

I come with a full clip.

Here's the problem, folks. I got 2 people who like me a little bit too much and hate me all at the same time. This is way too perfect for them.

Spiritual gift.

It's a fun show, so it's all about the good. So, so here was, here was my concept for, for, for tonight.

Okay.

Since all of us are aged.

Yes, that's true.

And, and we've all bought homes.

Yeah.

And sold homes.

True.

So if you could then, you know, reach back in time and, and, and talk to your, you know, 20, 25-year-old self. Like, what, what do you wish that you knew about your house then that you know now?

Okay. Yeah, I'm, I'm down.

We can do that.

Yeah, sure. Yeah.

So, because, like, I think because, like, all of us are kind of in, like, different situations too. Kev, I know you're looking for some property and wanting to build. You're actually in the middle of building, right?

Yep.

And I don't know what the heck I'm doing.

You've got the weird house.

Yeah.

We all know that.

So obviously I don't know what I'm doing, but we'll get it sorted.

Sure.

The good news is I'm still better off than I was then.

True.

So who, like, well, let's do this. What was first home bedroom, bathroom square footage?

All right, Eric, you go first.

First home, actually, first home that I purchased was new construction. So I would have to venture into both the two, my first two homes. First home was new construction. I was single at the time and it was $1,398, 3/2. It was in a brand new neighborhood and I bought it 2 months before they actually finished construction. So I was able to pick some of the finish out. Uh, the—

That's nice.

One of the— it really was. And one of the best parts about that home, being that it was a 3-bedroom under 1,400 square feet, was there was not a single hallway in the entire house.

Wow.

Uh, there was— I mean, you, you have a basically a 20 by 20 living room, which is gigantic for a home of that square footage. Uh, every bedroom came off the main living area. there was a slight indentation where the second bathroom was, but the, the first bathroom was obviously in the master bedroom, and then there was a breakfast nook. And so I will say this for that builder, um, ended up having to get out of it really quickly and was somewhat upside down on almost on it, but the use of the square footage of it was incredible, and it has influenced every single home I have bought since then.

Was that because of that living area specifically, or was it just because of The way it was laid out.

It was the way it was laid out. Again, I was single at the time, and so I, at this phase of my life with children, I wouldn't go back and do that same thing again because there wasn't a main dining area. There was a breakfast nook, and so it was more almost of an entertaining kind of floor plan, but had a really big master bedroom, a really big master bathroom. Of course, new construction, great bathrooms, walk-in shower, separate bathtub. And so I think that the— it was a very modern layout for a home. And I think that the, the, the other 2 bedrooms played into that as well. I think one of them, I believe, if looking back, one of them was 10 by 11 and the other one was 11 by 12. And so neither one

of them were very large. And so I think they utilized their square footage really well for a starter home. It said, you know, look, as the, as the owner of this home, you have a great living space. You have a great bedroom space. You have a great master bath space. Everything else is secondary. They're your kids. They don't need any space.

That's right.

They're— they can—

they can get closet under the stairs.

That's right.

Hovel.

That's right.

You know, all they need is a hovel. And so, it was a— is incredibly— the only reason I was upside down on it. So this would have been— I purchased, purchased that home in 2006. The only reason I was upside down is because I had to sell it 6 months after I bought it. Had I not been able to do that, I could have— I still sold it for, uh, you know, almost, almost what I paid for it. And so, um, you know, if I'd have been able to stay in that house 3 or 4 years, I definitely would have come out on the other side because I made several improvements to it immediately after buying it. So, um, second home was a whole different story. I bought a

30-year home, 30-year-old home, second home. So if we want to talk about that, that's a different story.

So you feel like the first one was a smarter move than the second one?

It depends on what you're looking for. So you made the comment about how I'm building right now. I've already built one home on 55 acres. After leaving that home, every home I've owned was a little further out of town. That first home was on the edge of the city limits. My back fence was out of town. So as long as I walked past my back fence, I could shoot fireworks and guns and burn things. My next home was on 6 acres outside of Longview, Texas. Then I moved, uh, to Lindale, which is just north of Tyler, and it was a Satterwhite log home on 20 acres. Learned a lot with that about, you know, log homes and, and the

construction and the, the longevity aspect of dead standing timber. Uh, so every time I've moved out, it's been a diff— my, my goal has always been to be on acreage and to be, uh, further away from not society as a whole, but just to have a, have a space of my own, which I know is something that Kevin is looking for right now as well. We've talked a lot about that. And so I was able to compromise on a lot of things given the acreage that I had. That first home that I bought on acreage, on 6 acres, had a pond, uh, had a live creek running through the property. And so it was a— it was, it was so easy to sell. I, I, I, I, uh,

I netted $60 grand on the sale of that home.

Nice.

When I sold it, uh, only, only investing about $9,000 into it. So, um, a lot of that with, with owning country property, there's a— I think there's a threshold. If you can stay in that 20-acre range, you're able to make a lot of money. Anything above that, you narrow your market so much. Yeah. Because it really minimizes who can purchase your home, uh, that it changes things. But if you can stay under 20 acres and under 3,500 square feet on a home, you really stand to be able to make a lot of money if you're willing to do certain upgrades to your home. Yeah. I took us way off topic.

No, no, no, no, no, no. I agree with you. I mean, like, you definitely, Like, you'll see around here in particular, you'll see, you know, parcels of property that have a house on it under 20 acres more expensive than ones over 20 acres. Sometimes it has to do a lot with the house.

Right.

But you'll, you'll still see that quite a bit. And it's— I think part of it is it's, it's almost easier to manicure 20 acres than it is, you know, 30 or 40 acres.

A lot of that depends on the, the exemption you're able to get on the property as well. Because on a, on a smaller property, whether you're going to go to a timber exemption or an agricultural exemption, you can't afford the taxes, right, on anything over an acre and a half. And so you're going to have to go for something. And so, uh, whether, you know, in a, in an urban setting, you can have chickens, you can have goats, you can have things that are low maintenance, uh, that's going to get you your ag exemption. But if you're regularly harvesting timber off the property, like my property in Lindale, you're able to not have to have that animal exemption and still

basically only pay your taxes on your homestead.

Yeah.

And so without that, I looked at a property that was 20 acres that had no agricultural exemption, and the monthly taxes on the home were more than the mortgage.

Geez.

And this is surprising. No, it's not. But when you look at a listing price, and that's something you need to consider when you're looking at the price of a home, is all the other, uh, things on the outside of that. It's not just what your monthly mortgage is going to be, is what's your, what's your insurance going to be, what's your upkeep going to be. You know, it had a pool, and so what was the upkeep on that be? But then when you see that the, the county taxes, and you look at, or even though you're not in the city limits, if you have a junior college in your county, you're going to be paying into that, you're going to be paying your school district. And so

it's not just the mortgage, so many other things you have to consider when buying that, that property.

Yeah, well, I can even on that, I mean, like, if you, if it's an unexempted parcel of land, like, we're just talking like a 20— is that what you said?

It was 20 acres.

Yeah. So I mean, like, even if you go into that and you say, well, I'll just make it ag exempt, what a lot of people don't realize is, like, if it's never been an agriculturally exempt piece of property, you have to show 5 years of history. So not only are you having to pay the taxes on those 20 acres while you build that 5 years of history, you have to do the investment of the agriculture to show the 5 years of history, which can be— I mean, that can almost be more expensive than the taxes themselves.

It's incredibly expensive. And there's a third kind of exemption you can get called a wildlife exemption.

Right. Which a lot of people do. It is.

And so that's what I did on my last property. I purchased 55 acres in Henderson County, which is about an hour southeast of Dallas, and it was under an ag exemption. So I went to the appraisal district and I talked to them about it, and they said, well, it's currently under hay production. And I said, 49 of the 55 acres are heavily treed. There is no hay production on this property. And they said, well, what we have is that it says 35 acres under hay production. Basically, the former owner had lied about it, and the county extension agent had never come out to check the property. And so I was gonna be honest about it.

Which is very— that happens all the time.

Well, it made me think— made life a lot more difficult for me. I lost my ag exemption on the property.

Right.

Which made me lose my— I was in the process at the time of purchasing a 75-horsepower John Deere tractor.

Oh, gosh.

That I paid all the taxes on.

Yeah.

Because a wildlife exemption does not give you taxable tax breaks. It gives you the break on the property. But even as you were saying, Craig, you have to make continual— with the wildlife exemption, you have to make continual improvements to the property.

Yep.

Every year, reaching one of 7 different market improvements on the property. Actually, 3 of 7 every year.

Sorry.

And so even that is an investment ongoing, you know, far beyond maybe on an ag— what'd you pay for diesel or fertilizer or something like that? You know, timber is by far and away the easiest. All you're doing is paying the company to come in and harvest your trees. So it was a lesson hard learned that I wish I had learned ahead of time. But again, with each home that you purchase, with each property you purchase, you learn something new.

So we're And this is because my, my ag exemption kicks in this year because I've—

Oh, so you've done the 5?

I've done the 5.

Right, right.

Um, are— so are you— and I, I'm not aware of this— were you able— are you able to write off the taxes on ag equipment?

Uh, on my wildlife exemption, I was not.

Uh-huh.

Uh, on an ag exemption and on a timber exemption, you are.

Okay.

So there are specific different kinds of, uh, that are centered under each one. Like, for instance, a tractor qualifies under each one.

Okay.

Uh, I had a timber exemption on my property in, uh, Smith County, which is North Tyler.

Yeah.

Uh, I had a log grapple on my tractor, and that's— that was what I used it for. Uh, but I was simply using it for, uh, selling cordwood for firewood. I wasn't having a timber— because it was only 20 acres, so I couldn't— it wasn't like I was clear-cutting it. Um, with an ag exemption, you're able to write off a lot of different things that you can't with a timber exemption. You can write off almost anything that applies to the property for the purpose of supplementing your agricultural operation. And so, okay, it goes, you know, beyond the diesel of your tractor, beyond the purchase of your tractor, beyond all the implements for your tractor. It goes to— on my ag exemption, I could write off an axe or a chainsaw—

or sorry, on my timber. But on my ag exemption, if I had kept that, you can write off feed for your animals. You can write off an incredible amount of things, many more than a timber exemption. Timber is very specific.

Sure.

If you go on the Texas state website, you, you'll see about 25 things that you can write off. The ag exemption is way more encompassing.

Okay.

Uh, it's just that it's nothing I've ever had. I could have kept it if I hadn't wanted to be honest with the appraisal district, but you know, you got to live with yourself.

Yeah, absolutely.

So yeah, there's, there's a laundry list of things you can write off.

I'm gonna check that out. I mean, mine's definitely bees, but—

But that counts. That counts. That's— and then that is what a lot of small, uh, anything over— anything between that 5 and 10 acres, which I think is what you're on here.

6. Yeah, yeah.

That's what a lot of folks do. A mutual friend of Kevin and I, Danny Snell, he raised bees for many years until they died in a hard freeze, even though he had hay, you know, surrounding the beehives. And so, uh, that's what a lot of folks do.

Yeah, it's one of those deals where it's funny how some of those things work because so many people can get away with saying they have an ag exemption of some sort because they're, uh, they're inundated with Um, the people that come out and check all those things, they're inundated with people saying, look, we've got an ag exemption.

They're gonna—

they're not checking all of those things all the time. So there's a lot of people that are lying about that. In fact, we, uh, Craig and I have a mutual friend who I was asking him the other day about, about, hey, it's like, how are your bees doing? I mean, I know you gotta— you're working on your bee—

What bees?

And he was like, he was like, yeah, so I, I know I'm supposed to have bees, but they swarmed multiple times and I haven't gone and bought new ones. But, you know, that's one of those things that unless someone is coming out and regularly checking those things, um, we are in no way advocating that you should lie about this thing.

No.

But, but there's a lot of people that do, unfortunately. And so, you know, you gotta, you gotta live with your— like you said, Eric, you gotta live with yourself and kind of figure out like What am I willing to do? What am I able to do? What am I going to do in order to make sure that I'm living up to the thing that I'm telling people that I'm living up to?

Well, I can tell you about myself that I'd recently sold back in January. That property was sold, the 55 acres that I purchased, and the county extension agent came out to that property for the new homeowner to look at it and kind of evaluate their ag exemption. I live in a county that only has about 30,000 residents for the whole county. Y'all are in a much more densely populated area here.

Sure.

And so, you know, the ability for them to come out and examine an individual property is much more probable than it is here. So I would, I would readily assume that people abusing that happen— happens a lot more often.

Is that a county agent?

Uh-huh.

Okay.

Yeah. County extension agent comes out.

Yeah. So, like, I mean, I, I don't, I don't know that a lot of people realize, like, how bad that problem is where, like, people aren't being inspected on a regular basis.

Yeah.

You know, like, in, in my business, like, we get inspected, like, every other year. And, like, please don't hear me saying, like, I would like to be inspected more. But, like, like, there are— I would like other people who aren't as responsible as the way that we do things to be inspected more. Or, like, people who have had, you know, serious strikes be, you know, have, you know, more frequent visits or sooner visits or different things like that. And so like, it, like, it really frustrates me when I, when I hear things like, well, and like, even, even our county agent, like when I told him what we were doing and I established our history 5

years ago, he told me, you know, hey, just give me a call when you're done. And I said, cool, you're just gonna come out and check it? And he goes, no, I'll probably just do a phone call. Yeah. And it's like, it's, it's because he has like bigger fish to fry.

Sure.

You know, like, I— like, he's, he's really not interested in coming out and like doing a look-see at my 6 beehives, you know, because it's not worth his time, right? But like, at the same time, if I were a dishonest person, like, hey, do you have 6 beehives?

Yep, here's a picture I found on Google.

That's right, right, exactly. And it's one of those deals where, where so many people could say, yeah, it's not a big deal, they're probably not coming out here anyway, so You really kind of got to figure out like, what is it that I'm going to do? And, and at the end of the day, Craig and I would tell you, just do it the right way because at the end of the day, that's what you're supposed to do.

Yeah.

And that's what you're legally obligated to do. And just because someone doesn't necessarily check up on you doesn't mean that you shouldn't do that.

Right? Yeah. Yeah.

So, all right.

So, so to circle back around first house, what, what do you wish that you knew then that you know now?

Let me go to my second house because my first house was kind of— I just kind of slid into it. I bought a, bought a 1,980 square foot, also built in 1980, square foot home. Had the old— it had a heat pump in the home. And so the compressors on the exterior of the home were what you would call now the style that are used in mobile homes. They were long, low, and rectangular. They were 27 years old. And, you know, I wish I had— having had a brand new home for my first home, I literally didn't have an inspection done on it. You know, it's not even required to— for your insurance company to have you done that, to do that. And so I had an inspection done on this home, and one of the— they— one of the Smart things that I

did—they came and cleaned out the ventilation system as a result of that. You know, they checked the HVAC and everything was was working. But one thing I learned that I wish I had put money back for at the time and ended up working out okay. But you know, at 27 years old, for your compressors and heat pumps, that is past the life expectancy of those units. And we what we learned is that in a you know and and down here in the North Houston area. Y'all don't experience cold temperatures near as much as in the north, you know, the Dallas area. But, um, you know, we were closer to Shreveport at the time, and we would get dipped down into the 20s, you know, probably about 2 weeks out of the

year.

Yeah.

And, and 24/7 that heat pump ran. It never got to the temperature that we wanted it to get to because the insulation was poor in the home. And so 2 things I wish I had, I had learned about, I had, I had prepared myself for One is the fact that really right off the bat, those, uh, the, the units need to be— needed to be replaced, uh, because not only did they not heat the house to the degree that we wanted it to be heated, but my electricity bills— because everything was electric, there was no gas on the property at all. And, and that's something to look into when you're looking at a property as well, is do you have natural gas resources

or, or are you willing to put in a propane—

Yeah.

Exterior propane tank, which is what I did on the last house that I bought, and I'd do it again in a heartbeat. So I didn't know either one of those 2 things. And number 2 is going and looking at sufficient insulation in your attic. You know, you're not able to just, you know, rip your paneling off your walls, which we didn't have drywall. That tells you the age of the house. It was delicious wood paneling in the house.

Oh, yeah.

Yummy. Different textures and colors, and it's just wonderful. But there was not nearly enough insulation in, in the second floor. And so, you know, having somebody come in and, and really explain to me as a, at the time, uh, you know, a 28-year-old, that this is what you want. You know, this is the amount of insulation you want. You have kind of a minimal insulation. You've got 2x6 joists up there, and I can still see the top of all of them. And so, you know, I'm talking about 4 inches of insulation in my ceiling with a heat pump unit that can't keep up with it. And so my electricity bills are through the roof, which I could

have helped a lot of that, right, by going in initially and just adding a little bit of extra insulation to the home. And so I think number one, that, that would've been my biggest thing upfront because it really cost me. I was able to come in and, and replace those units, but at the same time, also add insulation. So really cut back on all those at the, at the same time.

Hey, Craig.

Yes.

Maybe you should spend a stimulus check on that. Listen to our episode a few—

That's right.

Episodes back where we talked to— where I specifically said it's a great way to spend your stimulus check is—

So—

Is on insulation.

Not on big screen televisions.

Well, that, that's funny.

Like, Because we, we actually talked through those things.

Yeah.

It's like, there's some things that you can do to actually improve your home. And most people don't look at things like insulation, but it can really, really save you. And what you're telling me is that for you specifically, looking at some of those things, like, this is something that can significantly change the value of my home, and it could also change the monthly bills that I pay for my home. and how my HVAC system actually works and the longevity that I'm gonna get out of those things. So, like, it's just a, it's a big deal. Yeah.

So, well, at the time, there were a lot of available tax credits for going in with energy efficient systems. And so, you know, this really plays into the idea of the stimulus check. We were, we were gifted some money from a, an oil lease that a fam— a family member got. And I've never cried at a Christmas present before in my life, but was given the option of $3,500 Now the whole system in and of itself was about $8,000. But because of the tax breaks for clean energy and different things at the time, because, you know, we're talking about 2009 at this point, we were able to get the whole system for about $4,000. And I opened this, and I

knew it. I'd been pricing it because we were just struggling every month in the winter months to make this happen. And never in my life did I think if I was given $3,500, I'm gonna spend this on an air conditioner. I would have bought Rangers tickets. I would have bought, you know, a down payment on a new television.

Yeah.

But I was so happy to get to buy a new heat pump because it would change it, drastically change your life. Don't think about it in the moment. Think about every month what you're putting back towards your expenses and think about the ease, the burden that that takes off you every month. And it's— I don't— I'm not even concerned about the long-term investment because that's easy to understand.

Yeah.

It's that month to month, I can exhale this month. And it made a huge difference in our life at the time.

That, that's actually the most mature thing I've ever heard him say.

It's because we only talk about immature things. That's your fault.

It's either that or you don't talk that often.

That's right. It's not the truth. That's funny.

All right, Kev. First house, square footage. Yes. Bedroom, bathroom.

So first house we had that we ever owned was Um, it was a 4/2.5, and interestingly enough, it was only 1,950 square feet. But this thing—

It felt bigger than that though.

Man, it felt so big. Like, this place had 2 living areas and a really big kitchen and a whole addition on the back end of it that was basically a living area, a master bedroom, and a bathroom in and of itself. And, um, it was laid out— and it's funny, the We talk about this house.

That second living area with additional master bedroom made the— it almost made it feel like 2 houses combined in a lot of ways.

Yeah, it did. So I would, I would expect this house was probably like a 1,450, 1,500 square foot house before that addition was, was put on. And, um, so, so yeah, it was, it was a great house. The layout was really, really good. Um, I mean, 1950, it felt much bigger than that. It was no big deal for us to have Multiple times, we had, like, 20, 20+ people in that house just because of the, the job that I did and the things that I did in that house. But, but, yeah, it had a really nice backyard.

It sounds like you're in a bad Tom Cruise movie at that point. The things I did in that house.

The things I did in that house. We, we had a really nice backyard. It was, you know, we, we lived in Arkansas at the time. We got a really good deal on the house. We Felt like—

just property values are trash in Arkansas.

Yeah. No doubt. They were— they really weren't great at the time. Plus, we bought it in 2009. So, I mean, the housing market was— the housing market was not very good at that time. We had 2 sheds in the backyard. One of them was fully air conditioned and insulated and tile floor.

Great deck on that house as well. Yeah.

The deck was really, really nice. And then we actually added on to the deck. So There, there are some things we learned about this house, um, early on. It was like, how— what, what are the types of things that you can do to increase the value of the home? And, and one of those things is just livable space. Like, what can you do to increase the livable space? And so 1,950, I mean, a lot of people look at that and go, man, that's not very much, especially whenever you look at a 4/2.5. I mean, that's a lot of bedrooms and bathrooms.

A lot of small bedrooms.

A lot of small bedrooms. It feels like them, but they really didn't feel that small. Um, but so one of the things we did was we were able to increase the size of the deck. We had a pretty good-sized deck and we added on to it. And so you look at the types of things you can do outdoor living and ways to just kind of increase the space in the house. And the other thing that we did, you mentioned insulation. We added insulation. We added gutters on that house. It had gutters, but we replaced them. There's a lot of little things you do like this that homeowners that come into a house behind you go, man, those,

those are things we don't have to do. We don't have to worry about those types of things, right?

Yeah.

Um, what, what are the types of things you can do to a home that go, look, these are going to increase the value of my home? I can't— maybe I can't increase the square footage of my home, right? Maybe I can't increase— I mean, this house had a, uh, probably the biggest downside of this house is a one-car carport. And we, like, if you were actually looking at the types of things that you wanted in the house, we wanted a two-car garage. We got a one-car carport.

That was usually filled up with your camper.

Yeah.

It's actually true. We had a, we had our, we had a little pad on the side of it. We put our camper on it. So, you know, those are some of the things you kinda go, okay, we can compromise on these sorts of things. But, you know, I had good storage in the house. It had a good outdoor living space and those sorts of things. But, you know, we lived in that house for 7 and a half years. We loved that house. To this day, There are types of things we kind of talk from time to time. Like if we were to build a new house, we would probably incorporate some of the things that were in that house just because it

was laid out really, really well. 1,950 square feet. You mentioned, Eric, a house that you had that was pretty low square footage.

The 1,390.

Right. But it felt much bigger than that. So anyway, that was our first house.

Yeah. So what do you wish that you knew then That you know now?

Dude, I didn't know anything.

So just something.

Yeah. I knew nothing. When, when we bought this house, it was our very first house that we ever had purchased.

And you didn't even grow up in a house that your family owned.

No. We lived in a parsonage.

Yeah.

We lived in a house that was owned by a church, and it was a pretty nice house, to be honest. But, but a lot of those things were farmed out.

Taken care of by other people.

Yeah. So, like, if we had a plumbing issue, we just called the plumber and someone else paid for it. So I really didn't grow up having to take care of a house in any way, shape, or form. I mean, yeah, I had to mow the grass and those sorts of things, but beyond that, uh, other people took care of it for us. So this was a huge learning curve for us because we had to figure out like, what do we want? How much do we pay for this thing? And what kind of upkeep is it? And, uh, well, here, I'll tell you one of the things that, that was really interesting.

Mm-hmm.

I think one of the things you have to look at whenever you buy a house is just think about, okay, how do you take care of your most valued possessions? How do you take care of those things? I mean, I looked back after living in that house for about 8, about 6 years. I looked back at the inspection. I had never looked at it before. And I noticed that there was only like one thing on that inspection that we hadn't fixed in that amount of time. It was little things that, that we were like, you know, we need to check on this. We need to check on that. And I think one of the things we

learned that we didn't know is just how to take care of a house.

Yeah.

Is, is to notice things. It's like, look, there's a crack in the ceiling over there. Where did that happen? What do I need to do to take care of that?

Yeah.

Why am I feeling like my, my energy bill is more every month than it should be? Well, it could be little things like, uh, like insulation.

Right.

It could be little things like, like Craig, you and I have talked about multiple times, like just checking the weatherstripping around your doors.

Right.

Right? To make sure that, that bugs stay out, make sure the air isn't seeping in in those areas. Um, and just making sure that things are generally taken care of. You know, I think a lot of people just, they don't, they don't think about the things that just need to be taken care of so that you don't wind up with a big problem down the road. And so we learned a lot of those types of things, uh, living in this house. Just, um, you know what, I kind of liken it to the first camper that we ever had, which was a piece of junk in many ways. But it was like we learned a lot about just how to hook up a camper.

Right.

Things that we need to have in the camper in case something went wrong, those sorts of things. And, and as we bought a new camper from time to time, it's like we learned things along the way. And so I think sometimes you get into that first house and you go, man, I just don't— I don't know how to do this, but I'm gonna figure it out. Right. You know, that's half the battle is just choosing to figure it out along the way. So—

Well, and seeing that house before and then seeing it house after, I think one of the things that y'all learned is how to increase value in your home. And so y'all did a remodel. Yeah. We did part of the way through that. And, and, and little things that are beyond just the kitchen and the bathroom. So I think are the first places that people usually tend to invest their money. You did You did something that's simple, but for a person coming in, a prospective buyer coming to look at their house, you built a media closet.

Mm-hmm.

And so you routed all of your things away from a console that would be sitting on the floor. You put your receiver, you put your Blu-ray player, you put all your game— gaming things in that closet, hid it away from the eye, used IR receivers to kind of fix all that. And so it's something that really increases the beauty of your home from the outside eye. And it helped you in the process of not just being a homeowner, but being a seller of that home. for someone to come in and see this. This is a, this is a well-maintained home. This isn't, this doesn't look like a 25-year-old home.

Yeah, that's a good point because we actually, uh, when we remodeled that home, we kind of thought, okay, what, what types of things do we want to do in order to make this more, um, more appealing to the people that are going to come in? One of the things we did is we just, we, we created jacks for, uh, for speakers. Your banana jacks. Yeah, banana jacks, uh, for, uh, you know, just inline speakers so that the next person that had to come, if they wanted to put in a 5.1 surround sound system, the only thing they had to do is, is buy the speakers and, and no wires were ever going to be exposed. And like you said, the, the, the Blu-ray player, the receiver, all

of the components of those things were back in a closet somewhere else. And so It's one of those things where we created a media room out of a living room.

Yep.

And it, it, it, it didn't cost as much money because we were already remodeling the space. It was just thinking ahead, like, what are the types of things that I think that, that an investor someday down the road would look at this and go, this is a great house. I don't have to invest this money. It's already been invested. You know, what didn't really cost us that much more, we were already doing the remodel. Right? What are some types of things that we could wire in? And Craig, you talked actually recently in that stimulus check episode about, man, it would be great if my house was more smart.

Yeah.

Like we could put in lighting all over the place. And it's those types of things where you look at, I'm doing, I'm already doing a remodel, I'm already spending some money. What type of wiring could I put in here so that someone down the road doesn't have to think through this again? Those types of things, you look at them down the road and you go, man, I made a really smart choice because I'm able to increase the value of my home, and it didn't really cost me all that much money.

Yeah. In, in that episode, I, I was— what I was talking about was specifically the Lutron system.

Yeah.

Because one of the reasons I really like that one is because you can actually add additional switches without having to run any wires.

Yes.

And the, the switches, they're— I mean, what do they call them? I forget what they call them. But they're, um, they're almost like little remote controls. Yeah. But they jack right— you can, you can buy a faceplate for them and they just snap into the wall. And so they look just like all the other switches. Yeah. But so you can have multiple switch— so you don't have to do the 3-way wiring like you would usually have to do, which is just confusing to me. I don't understand how electricity works. Yeah. Just give me the— right. Just give me the switch.

Right.

Um, but like, not only that, like, because it, like, like you were saying, it creates the, the smart aspect of the home because you're then able to voice control all the lights in the house.

Right.

So it takes a little bit of work because you have to program them.

Yeah. But it's, it's that point. It's that point of thinking ahead. Right?

Yeah.

It's like, what, what down the road is gonna be one of the most desirable things? It's not just necessarily what has always worked, but what will work in the future. Right?

Yeah. And that, that's a, I mean, like, That would be, like, a significant— like, if I were to sell this house right now, that would be, like, a significant piece I would have to part with. Because you would have to leave, like, that router for the Lutron system in the house in order so that they could then use all the lights that we've programmed in the house.

Right.

So, like, it is, like, even though it's— I think it's, like, a $100 piece of equipment. Like, it's a $100 piece of equipment.

Sure. I—

you usually buy something like that, and you're like, well, I'm gonna take that with me.

Mhmm.

No, you're not.

No, not, not if you actually want to sell your house.

Right.

Just people are gonna go, wait a minute, I want that.

Wait a sec.

Right. It's like lots of people will say things, little things like, oh, I want you to leave the refrigerator.

Right.

Because it matches the other appliances. You're like, okay, fine. If I want to actually sell my house, I gotta leave the refrigerator and then I'm gonna have to go buy another one. Right?

Yeah, that makes sense because if you have automated blinds, you want the thing that runs the automated blinds. Yeah, it's a little bit different with the refrigerator. You can say like, hey, you can buy a new refrigerator, but I can't make the blinds go up and down if you don't leave behind that $100 router. So you're looking at that as, that's a, view it as something that's affixed to your walls because those are the things you have to sell with your home. It's going to go with your home.

Yeah. And if you do that correctly, then it's not going to be a big deal, right? You've built it into the price of the house. Like now your house is worth a little bit more because of those types of things. So it just makes sense. Yep.

So, well, and you say the refrigerator, but if it's like one of those smart glass Samsungs, I'm not leaving that.

No, absolutely not.

So you actually have a TV inside your refrigerator?

Yeah. I will leave you a refrigerator. I will not leave you this refrigerator. That refrigerator. That's right. This refrigerator knows my name now. I've taught it my name.

That's right. Good old Cracker from the garage. Yeah. That's right.

All right. So Craig, Tell me, tell us about yours.

Uh, so mine was a 2,200 square foot 4/2. Okay. And I think technically the 4th bedroom was like an office slash bedroom. Sure. A lot of people use them for bedrooms. Um, it was actually a model home. Oh. Um, that, uh, we— so it was a negotiation between my wife that we even ended up in a neighborhood for our first home, uh, because I would have been more happy underneath a tent on some land, but we couldn't afford that when we first got married. We could have afforded the tent and the land.

Just the land, not the tent.

Yeah, exactly. So we would have had to kill the yak and then skin him and all that kind of stuff. Beautiful. So it would have taken some time. We would have done it. But yeah, so it was a starter neighborhood kind of a deal, but we found a neighborhood that was closing out their construction process. And basically the only things that they had left were their model homes, and they were having a time unloading them. And this was right before the real estate crash in 2008. And so prices hadn't taken that dive bomb yet. And so real estate was still pretty aggressive at the time. And we kind of went in, we toured the house, we liked the

house. I mean, it wasn't perfect because they'd been using it as an office and it didn't have a driveway because it was a model home.

Okay. In the neighborhood though.

In the neighborhood.

Was it just like landscaped?

It was landscaped. Yeah. And so with the purchase, they had the agreement that they would then put in, remove the landscaping and put in the driveway. All right. So we went in, we liked it. It was gonna be a good size house for us. I was in a similar situation with Kevin. We're gonna be having lots of people over from week to week.

Right.

And, and so it was a good— and it had a big open concept, which was nice because, you know, the bedroom could sort of stay sequestered from everything else. And then, you know, we could entertain people in the big open room. But when we went in and sat down, I thought they were asking too much for the house. And so our real estate agent was like, what do you want to do? And I said, well, just offer them $20,000 less than what they're asking because they're obviously not moving this house. It's the only 2 left. They had this one and then the really nice model next door, and they were going to have a way easier time moving that one. It's a bigger house. It was a prettier house. And I said, well, just

offer $20,000 below. And my wife kind of gave me the elbow. It's like, you can't do that.

It's rude.

I can't imagine that your wife would have done that.

And I said, no, let's, let's just go ahead and do that. And, like, you know, if they don't like it, they can always just say no. Sure. Or, you know, like, it opens negotiations. Well, they took the offer. Nice. And, and so we were able to get into a much nicer house than— and at a more affordable price. Right. And just because, you know, now, I mean, like, the The crappy part was, is like that the value of the house tanked in like the next 6 months.

That's just because of the nature of the market, right?

Right. Okay. Yeah. So that sucked. Been there. But we had agreed that we were going to try and stay there 4 to 5 years. And it was a negotiation in our marriage because it was like, I don't want to live in a neighborhood. I was like, I'm willing to be miserable for 4 years as long as we can work towards getting towards something else.

Right.

And it just so happened that when we sold that one, when we got ready to sell that one and we found the place that we're living in now, that we— that was— so Exxon opened their campus right down the street, basically. And which skyrocketed real estate value.

Yeah. Because there's a lot of people all of a sudden looking to buy in that neighborhood.

Yeah. I mean, I think at the time they were looking to have like 30,000 people on the campus of that complex. And so like we were within 5 minutes driving distance of that campus.

Wow.

And we didn't know that when we bought the place.

Sure.

It just happened. Like we're not smart. We just dumb lucked into that one. And so like when we put it on the market, we had international buyers with with cash offers like the next day.

Right.

Um, you know, because they, they wanted to, to basically flip it into a rent house.

Sure.

Um, and so like, I'll just tell you guys, I mean, like right off the bat, I mean, you asked me what I learned. I wish I would have learned that lesson. Like, I wish I still had that house.

Right.

Uh, because it's a cash cow.

Yeah, because at that point it was worth a certain amount, but that Exxon campus isn't going anywhere.

No. And, and like right now Like, I know that that house that we owned is worth 3 times what we paid for it.

Wow.

So, I mean, like, if nothing else, I could have just pulled the equity out of it.

Sure.

Like, the, the, what, what they call the phantom passive income. I mean, it's, you know, it's like, like money that, like, you just, you know, appeared out of nowhere.

Yeah.

Because, you know, real estate values just went through the roof.

So do you think there's something to be said for people that buy a first house choose to buy a second house for whatever reason, whether they move or whether it's just a job situation, they have to move, whatever. Do you think there's something to be said about just owning that home still and renting it out? Oh, for sure.

Okay. Yeah. I mean, like, it gives you a lot of tax advantages for one. But two, I mean, like, if you can make it to where it, you know, what they call cash flow, You know, we're like, you know, and what, what that essentially means is that the renter is paying more than what the mortgage costs you.

Right.

You know, after, after all the expenses are paid, then, like, why wouldn't you?

Yeah. So, well, I would say the biggest barrier to entry in that, in that mindset, that model is just, how am I gonna afford another mortgage whenever I've already got a mortgage?

Right.

And I think a lot of, a lot of that is just not understanding the real estate market, not understanding the fact that, um, well, like, like right now, you—

it'd be really difficult to do that, right?

Because like, well, sure, because housing— the housing market right now is ridiculous.

It is. And like, here's, here's what's ridiculous about it is because we, we, we've had this conversation about— because we, we could net about $200 grand by selling this place right now. Sure. You know, purely because it's, it's just gone up in value that much based off what people would be willing to pay for it. Yeah.

But like, selling it's the easy part, right? But then you got to turn around and get into something else. Where do we go?

Right. And like, what am I willing to pay to get into that? Yep. And like, I'm not, you know, I, what am I— I'm just not willing to do that right now.

I don't want to do that here. Right.

The, the prices are just ridiculous.

Yeah. Because it's all relative, right? I mean, if the housing market is high, yeah, you're going to be able to sell your house at a premium, but then whatever you buy is going to be at a premium as well.

Well, and with construction costs what they are right now, that's what I'm running into. You mentioned earlier, Craig, that I'm looking at— I'm under contract on 34 acres right now. Yeah, but it's a really weird conundrum because lumber costs are through the roof, steel costs are through the roof right now. Uh, you know, if you're looking at a, a sheet of MDF from I, I built 3 years ago, $9. Now you're looking at $39.95, right, for the same, same sheet of plywood. You know, that's generous calling MDF plywood, right? But, uh, at the same— on the same token, we're looking at historically low interest rates on permanent loans, on 30-year fixed interest rate loans, anywhere from 2.6% to 3.1% if you have a good credit rating. And so over the course of the

next 6 to 9 months, those are guaranteed to increase. And so some people are holding off on, on a, on building a home because they're hoping to see construction costs go down.

Yeah.

At the same time, your loan interest rate is guaranteed to go up over the next 6 to 9 months. They're projecting at the earliest that lumber costs will not decrease until November of this year at the earliest, if they do by then. And so I find myself in this interesting position of do I go ahead and build and get significantly less than what I got 3 years ago, but lock in an incredibly low interest rate? historically low interest rate, or do I wait, put myself in a temporary position, whether that be through, for us, what's going to be a travel trailer and just kind of stay on the property, the tent, if you will.

Yeah.

And do that for a little while. How does that affect my family? And so there's a lot of things to consider and there's really no great answer. If you talk to anyone in the banking industry, it's all a kind of a toss-up. You may you may end up a year from now with lower construction rates, but in, you know, extensively higher interest rates. And so there's not a great answer to what, what we do right now. We're in a, we're in a bit of a conundrum right now. If one of those was any different than the other, it'd be an easy answer. But right now it's just, you know, the, the scales are kind of leveled out and there's not a good answer moving forward.

Yeah. I, when we were talking earlier today with our, our buddy Eric, uh, at over in Portland, I mean, like he's, he was telling us that like con— construction prices are up over 300%. Mhmm. You know? And so, like, I think that's an important thing to weigh out is, like, am I willing to pay 300% more for the materials in order to build this home? Is that, is that more expensive than 1 to 2 ticks up on my interest rate? Mhmm. Yeah.

And at the end of the day, most people don't know. Like, they don't do the math.

No. No. Yeah.

There, there's math involved in this, and they just don't know. Yeah. And so they're relying on a realtor or they're relying on their mortgage lender or they're relying on the market in and of itself just to produce that information for them rather than going in and doing the actual math. What is actually going to be best for me? And so, you know, we, Eric, you mentioned earlier that, that my family's looking at buying some land and we are. The problem with that is, is we've just basically decided it's worth waiting. And, and it's just because it's one of those deals where even if you buy a piece of property, then what? Then what do you put it— do you build a

structure on it? Because the amount of money they're gonna spend to build a structure on it— or do you buy something that's already got a structure on it and then you just wind up remodeling it or do whatever you have to do? At the end of the day, you just have to weigh and understand the fact that we're in a very relative place. The amount of money you're gonna spend on it is very relative to the interest rate. At the end of the day, uh, 6 months down the, the road, a year down the road, maybe interest rates are higher, but maybe lumber and steel prices actually go down. And so it, it, it's 6 in one half and doesn't in the other sometimes.

And in your position, you, you have that ability to wait. I was in a position where I didn't. I didn't, I, I'm, I wasn't interested in building right now. That was not my desire to do so. And so this is not the economy that I was hoping for to find myself in this position right now. And if I had the advice to give someone right now, I would say, wait.

Yeah.

Y'all are in a position where y'all can do that. And I think that's absolutely the right decision right now. If you can find a great price on some real estate and you have the expendable income to do so, take it while you can get it. But on the rest of it, hold off and do that long-term math. It's a very minimal amount of work upfront. front to save yourself some long-term headaches and some long-term financial— you look at the amortization of your loan and you see what's going to happen over the course of— even if you do a 30-year fixed and you wanna pay it off in 22 years or 20 years, do that math. Understand what you're going

to put in in the long term. It's never a decision you're gonna regret in the long term.

Yeah. Because so many times, I think what happens is we make emotional decisions. Yeah. For sure. For sure. Right. we find a property that's like, oh, we have to have it.

Yeah.

That's the perfect property. It's got the, the square footage that we want. It's got the number of bedrooms that we want. It's in the neighborhood that we want. It's a school district that we want. Right? All of those sorts of things. And the problem is that you don't necessarily recognize the fact that that exact type of property could pop up somewhere else. And so you wind up making an emotional decision rather than a financial decision. And I'll tell you right now, emotional decisions can put you in a place where you're not financially viable.

Hmm.

Right? It puts you in a place where it's like, look, you can't afford that. You don't really want to afford that. It, it, it feels good, but it doesn't make financial sense. Right? So, you know, I think one of the things we learned early on whenever we bought a house is it's way better to get into something that's below what you can afford.

100%.

So that you can—

You got some wiggle room.

Absolutely. The wiggle room is so important and it's so easy. It's so easy because the banks make it easy to buy something more expensive than what you can actually afford. And then you're out there eating ramen noodles, sitting in your, you know, 4,200 square foot house. And it's like, what did I just do?

Yeah.

And why? And do— and, and for what purpose, right?

Yeah.

So I, I think there's so many things that, that we can look back on and go, man, if I just would have been a little bit smarter, if I would have just waited a little bit longer, if I would have just, you know, asked the right question, if I would have hired the right realtor, if I would have made sure that the right mortgage lender actually had my best interest in mind rather than just like seeing me as another number. Right. Yeah. Um, all of these things are things you need. And, and honestly, like, if you're gonna buy land, what type of ag exemption can you get? And, and can you manage? Can you manage? And is there already an ag exemption there,

or are you gonna have to produce it yourself? Right. So all of these types of things have to filter into your mindset, and it's not an easy answer. It's the biggest decision you'll ever make. Right.

One of them, in going through the construction process, one of the things that I learned that I never learned in going through a traditional permanent loan process. When you go through, maybe you go to LendingTree and you determine, I want to get my 5 best offers, because that's what LendingTree will tell you. When you go through a construction process, you actually have to go through a local bank, through a credit union to get that construction loan on your property. A banker is going to tell you, and this is the same thing that a mortgage company won't tell you, but it's true. They're going to lend you 40% of your income towards your mortgage.

Yeah.

Now you can do some serious math and you think, man, I can afford a lot of house. Well, you can, but when's the last time you actually put 40% of your income just towards your rent, just towards your mortgage? And the answer is never. And so when you really go out there and you look at what I possibly can afford and they— the bank tells you, yeah, we'll lend you that money, it's because they know this is the maximum livable amount that if you cut everything else out of your life, you can still afford it. Sure. And so the idea that just because you can afford something, as you were just saying, doesn't mean you should.

Just because you can financially pull it off doesn't mean your life isn't going to be in shambles as a result.

Right.

You're, you're cheating the system. And really, at the end of the day, you're cheating yourself.

Yeah. You're hurting yourself.

Yeah. And so one of the things that I would say that you did really, really well, Eric, is you, you bought houses below what, what you could have bought, right? You spent a lot of time fixing those things up, and it could be little things or it could be big things, but at the end of the day, you increase the value of your home. You sold them at a premium, and so you were able to get into a bigger house, a, a greater amount of property, because you, you put the effort in upfront, right?

Well, look, I know you look at me and you think that's an incredibly good-looking man, And that's what I look at when I see the mirror, Rick.

Well, it's easy when you're sitting next to him.

Yeah. By comparison.

I've never thought that.

No. But I'm also, I'm also almost 41 years old. I would say that—

That's obvious, by the way.

Yeah. Thank you. What we— I'm a, I'm a, I'm a, I get carded everywhere. I'm a great looking 40-year-old.

Yeah. They, they card everyone under 65.

If I was mean, I would ask if it's like the AARP But I'm getting the mailers already.

I'm getting them. I'm the oldest person sitting in this room.

But I'm not a mean guy.

I wouldn't do that to you.

Would you ever do that?

I would never do that.

And so what were we talking about? Y'all derailed the snot out of me there. I had a great place I was going to. Oh, man. All right, new topic.

I honestly don't know.

Correct. Anything? What were he and I just talking about before that?

I'm really just too proud of my AARP comment.

Y'all ruined all of it.

We should have a rewind and pause button right now.

Yeah, that's what happens when you're friends with gingers, man.

Look at it. There's nothing you can do at that point. It just is what it is. But I'll tell you this, I don't know who's listening right now, but what I do know is that I feel like we've thrown out a lot of really good stuff. I'm not lying.

Of course you feel that way.

No, I really do. I think there's a lot of people out there that If they listen to this and truly take to heart some of the things we've talked about, like, there's a lot of people that could succeed simply by, by understanding where they're coming from, where they actually want to go, and the types of things that it's going to take you to get there.

I think you— I remember. I think you remembered where you were going now.

I was, I was off camera, but my face just exploded. And so you were discussing investments made over the last, you know, course of my life. You're buying a home at 25. I think the, the American perspective looking at it now, regardless of age, is I want what my parents parents have.

Okay.

And so kids are coming out of college at 23, 24, if they went to college at all. They've been living with their parents. They're like, I want what my parents have. I want a 3,500-square-foot house on this lot. One of the things I early on acknowledged is my parents, who Kevin has known since early childhood, growing up on— my dad's a cotton farmer. They worked their way up. I grew up in a very small home and moved my way up just the same way. And so one of the things I acknowledge is at 25, I'm not going to have the house that my 40-year-old parents have.

Sure.

And so in investing, building, adding on to, uh, growing up in a multifaceted family, was able to do electrical work, was able to do exterior work, was able to work on, on drywall, on, on different— everything basically short of plumbing and foundational work. And so was able to net large sums of money on each home that I sold. Having said that, I purchased a home at 38. that I, you know, I really felt like that was going to be the home I was going to retire in and, and looked at it from the aspect of, in spite of a profession that does not pay incredibly well, because of the investments that I had made over the years in homes and the amount I had netted, I was able to put down close to a quarter million

dollars from all of the money that I had invested. And so when people would look at my profession and, and my spouse's profession at the time, They would say, how did y'all afford this? And it was because the fact that we weren't trying to be 40 at 25.

Oh man, that's huge.

Yeah. And so we were living well within our means, underneath our means. And then we got to the point where we could easily afford more than we should have and looked at it as an— as a long-term investment, that we would not have a mortgage after the age of 65, that we could sell it and come out way on top and looked at it as a retirement opportunity. And I think if more people were willing to live under, as you said, Kevin, underneath their means and not right at the line, then they would have the opportunity as they got older and looked to the future and made 5 and 10 and 15-year plans that I don't have to be my parents at 25, which is, I would say,

not to the equality of COVID but is a pandemic in our country of I want everything and I want it now.

Yeah. No, I think you're exactly right. I think it's one of those things where we live in a Burger King type of society, right? Like, have it your way, right?

Yeah.

And it's one of those deals where just incremental steps can put you in a really big place to win. And so a lot of those things equal certain things. Like, Craig, you and I have a friend right now, that, um, their, their house flooded during this last, um, Yeah. this last freeze. And they, they bought their house really inexpensively. And then because they lived there for a long time, they've lived there for, for close to 10 years now. Because of that, they're going to be able to sell that house after getting it renovated from the flooding. They're going to be able to sell that house for so probably double what they paid for it. Possibly even more than double what they paid for it. And over those last 10 years, they've been paying down that mortgage.

Yeah.

And so, again—

Here at the Homeowners Podcast, we do not advocate waiting on insurance to pay off the value of the mortgage.

That's exactly right. But that being said, like, there, there's a lot of ways that you can say, look, if I wait another year, another 2 years, another 5 years, like, the amount of things that I can possibly do from here, It makes a lot of sense. Yeah. So just be patient. Make sure that you're not overinvesting. Make sure that you're not getting into a place where you, you're overcommitting yourself. Those types of things will really, really pay off in the future. For sure. We'll do that.

We've, we've waxed eloquently on this for well over an hour.

Dude, it's been—

What happened to let's make this 30 minutes?

Let's make this 30. Yeah. Yeah.

An hour and 10 minutes later, it's after midnight. Nobody is actually watching us live. Good for them.

They're probably asleep. They have lives.

They're like, it's bedtime. I'm sorry.

It's fine. Somebody's going to watch this and gain some knowledge that wasn't dropped on them.

Oh, dude, tons of people watch this.

I meant, like, tomorrow.

Yeah, they will. I mean, the numbers on Facebook are strong. They're creeping up on YouTube pretty readily. But yeah, it's such a good topic because I actually hope that people who are potential first-time homebuyers actually listen to that.

Yeah. 100%.

Yeah.

Well, cool. Well, hey, listen, thank you guys for tuning in tonight to tonight's episode, this morning's episode, whichever one you're listening to. Thank you very, very much. Eric, thanks for joining us tonight. Thanks for coming and hanging out with me.

Yeah, man. Happy to be here for your birthday. Happy to celebrate. And thank y'all for having me. I mean, homeownership, it's a big thing. And especially as someone, we haven't even discussed this tonight. My actual career is in ministry. I'm a preaching minister at a church. And so a lot of guys in my position don't even have homes to begin with.

Right.

And so I'm really grateful for the opportunity to have built equity in a home, to have a home when I retire. to look at this as an investment opportunity to be able to continue to pour into that. And so, man, I would just, I know that this is like y'all's bread and butter, but always increasing the value of your home. Because as someone who, not only when I lose my job, I have to move my, leave my community. It has happened to me in my life. And so having a home that is not just the type of home that you love, But a type of home that other people would love, that you're continually adding improvements into. It's something that has been in my

consciousness for the last 20 years, and it, it has paid great dividends over the course of time when I found myself in that position of always thinking from that perspective. And so make it the type of home that you love, but the type of home that anybody would love, and, uh, you're never gonna regret those kind of decisions.

Yeah, it's not just a place to live, right? Absolutely not. I mean, it it is a place to live, but it's more than that, right? It's an investment. It's a type of place that you want to feed into. So look, that's what we're all about here at The Homeowner Show. We're about helping you find a way to own your house a little bit better, to increase your quality of life, and honestly, to increase your family's quality of life.

Yeah.

And those sorts of things as well. So listen, thank you for tuning in to today's episode, and we're here each and every Tuesday. If you have not already, please go click the subscribe button. Apple's actually changing some things, right?

There's some changes coming.

Yeah, some things are, some things are changing. If you hadn't already seen it, if you hadn't already heard of it, some things are coming. But, um, you know, we're gonna be here each and every Tuesday providing you with continual content. So go leave us a rating and review. That would really, really be helpful for us. We would really, really appreciate you guys. But Yeah, so thanks for tuning in. Until next time, we'll see you later. See ya.