The Carpetbagger's Guide to Homeownership


In March I bought a modest house in Madison, Wisconsin as a rental property. I worked with good local professionals to bring that house up to a better standard and in July I found excellent high quality tenants. We have cordial relations and I’m confident they feel they’re getting excellent value for their money and are happy in their new home. That property is now contributing to my long term diversified retirement plan. Along the way I took an aging home that needed some love and gave it new life.

Then in October, much to my surprise, I bought a very similar house right across the street from the first one. I’m now employing the same group of local trades to renovate it as well. If all goes to plan it should be rented by spring to equally qualified and respectable tenants.

In a perfect world I’d much prefer to use my financial resources to build genuinely affordable new housing which society desperately needs. But this isn’t a perfect world. It’s decidedly imperfect. I learned that the hard way. So I’m essentially reaching back into the past and shining up the leftovers from a previous era.

My real estate agent Ben was instrumental in these transactions. Not only did he identify the right properties for me, but he helped assemble a team of trusted trades to upgrade the mechanical systems, paint, install solid wood floors, new appliances, countertops, look after the landscape, and so on. I honestly couldn’t have done any of this without his guidance or the great people he introduced me to. The first project was such a smooth experience that it gave me the confidence to move forward with the second sooner than I might have planned.

Ben recently invited me to be on his podcast on the topic of real estate investing. I hesitated. I didn’t want to be perceived as the token out-of-state carpetbagger driving up housing costs for locals and pushing up rents. The problem, of course, is I might be exactly that… So I asked if we could take a different approach.

Instead of me talking about my real estate activities as a comfortably middle aged guy with some extra cash to deploy, what if we had a conversation about how I first bought property when I was much younger and infinitely poorer? If I somehow managed to buy property in a crazy expensive place like San Francisco on a super tight budget that might help people in Madison explore their own options in a more moderate economic environment.

There are alternative routes to acquiring real estate for those feeling the squeeze. Being angry at investors or landlords doesn’t get people into the housing they need. Understanding the institutional structures of real estate and exploring creative work-arounds just might. I’ve written about my adventures in property before, but the subject matter is worth repeating. These options may not appeal to everyone, but they worked for me.

I’ll start off by saying I’m a housekeeper. I clean other people’s homes for a living. Are we clear on this? I’m a maid. I grew up in an unstable household that limped from crisis to crisis. I dropped out of high school, left home, and moved to the other side of the country. Leaving allowed me to find more fertile soil to plant myself, and my absence meant one less problem for the family to deal with.

When I first arrived in San Francisco I lived in a variety of “alternative” accommodations including this little 9’ x 18’ (15 m²) garden shed behind an old Victorian in a questionable neighborhood. There was a toilet and a shower stall in a little closet in one corner, and a minimal kitchenette in the other. There was just enough room for a bed and a cafe size table. It was affordable on my housekeeper’s income and I loved having a diminutive place of my own.

It was also sub rosa and illegal like most truly affordable housing in San Francisco. Nothing about this place met minimum code requirements or zoning parameters, yet it was perfectly safe and healthy. I sanded and varnished the old wood floors, painted the walls, installed a few cabinets, and generally personalized the space while I lived there. It was a fantastic spot that I’m still a bit nostalgic about decades later. The shed was never about the things I didn’t have. It was about the freedom it gave me.

Read the rest of this piece at Granola Shotgun.

Johnny Sanphillippo is an amateur architecture buff with a passionate interest in where and how we all live and occupy the landscape, from small rural towns to skyscrapers and everything in between. He travels often, conducts interviews with people of interest, and gathers photos and video of places worth talking about (which he often shares on Strong Towns). Johnny writes for Strong Towns, and his blog, Granola Shotgun.