The Big Lie of Home Ownership: Freedom is Living a Possession-Lite Life

I’ve long wanted to buy a place in Japan. I just love the place so much. But last summer when I was catching up with 2 old high school friends back in Vancouver, I was talking about getting some real estate in Japan and in Taiwan. My professional wealth management friend asked me “why, if I was only going to spend 3-4 months a year max there.”

There is the hassle and upkeep of taking care of the place.  Wouldn’t it be easier and more cost effective to just AirBnB or stay in a nice hotel. I could take the money I would spend on the properties and invest it in other cash generating businesses or assets. 

And the benefit of not owning, is I am not locked into one location, so I can explore new neighborhoods or cities or places. Which is the whole point of travel. Especially for fixed sign individuals like me who end up hanging out in the same places over time. I need the new environment and place to force me out of my comfort zone. See new things. It keeps me from becoming stale. 

So I’ve scrapped my plans to buy new properties overseas. Maybe this will change if I end up spending more than 6 months of the year in a place. But real estate ends up adding a lot of complexity in your life. 

As the previously brilliant and now literally crazy Robert Kiyosaki said “Your house is not an asset, it’s a liability.” I understand the need to have a place you think you own. The reality is the bank owns it until you pay off the full mortgage. And if it does not generate cash it’s not an asset. In fact it  actually becomes an anchor especially as you add up taxes and maintenance, stuff you don’t need to worry about when you rent. 

It reminded me of a friend who was very unhappy at his job and was looking to do his own thing. I gave him the advice that he needed to manage his cost structure and start on the side hustle asap. Or at least look at some new job opportunities. 

That was 4 months ago. I saw him again and he told me “remember when you told me to watch my cost structure?  Well, with a growing family I found a good deal so I ended up buying a house.” 

I knew at that moment, he will be stuck at his crap job and his entrepreneurial dreams will be stillborn. It will be almost impossible for him to take that leap while he is stuck with a monthly mortgage payment, let alone the sunk costs of his down payment.  I truly hope I am wrong but he is done. 

I don’t mean to be negative as I’ve been in that situation myself in the past and it’s hard to break out of this. There is too much risk in their mind  to start something new even though there is more upside in it. But there is definitely more instability especially in the first 1-2 years. 

So you give up your entrepreneurial dream and end up tolerating even more crap from your  employer than even before. Better the devil you know than the one you don’t. This is why most bosses want their employees in debt and living paycheck to paycheck. They will own you. It’s the closest thing to legal modern day slavery. 

Owning a house that does not generate positive cash flow through rentals or AirBnB-ing it, will be a barrier to freedom. 

So don’t buy into the lie that you must buy a house. There are opportunity costs to the money & time you get locked into. Especially if you want to start your entrepreneurial endeavors either as a solopreneur or new business whether online or offline. The fixed costs will wreck you.