Yahweh’s Money®️: The Crossroads of Religion & Money

Wealth in Real Estate: Owning Vs. Renting

• Crusaders for Change, LLC • Season 3 • Episode 74

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What if the choice between renting and buying could be guided not just by financial logic, but by faith as well? Joining Shay Cook on this fascinating discussion is Janessa Siegel, one of our Accredited Financial Counselors at Crusaders for Change, LLC. Listen as they explore the complex world of real estate investment versus renting through the unique lens of biblical stewardship. Drawing inspiration from Luke 16:10, they uncover how renting can be a wise and responsible step before transitioning to the commitment of homeownership. Through personal stories, they illuminate the often-overlooked challenges of owning a home, such as unexpected repairs and maintenance, and compare them to the flexibility and convenience that renting can offer.

The episode also delves into how property ownership can be used as a cornerstone for building wealth. They discuss the tangible benefits of real estate, not only as a stable and appreciating asset but as a means to generate passive income and provide for future generations. Whether you're contemplating the leap into homeownership or evaluating the practicality of renting, their conversation aims to equip you with the knowledge and faith-guided perspective needed to make these pivotal life choices.

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Our podcast is proudly sponsored by Crusaders for Change, LLC (C4C) and hosted by our CEO and Founder, Mrs. Shay Cook. At C4C, we provide customized corporate financial wellness programs for businesses, government agencies, and nonprofit organizations. Our services are tailored to create happier, healthier, and more productive work environments. We also empower individuals and couples to overcome debt, improve their credit, boost savings, and more. Ready to learn more about how C4C can impact your life? Contact us today at https://www.crusaders4change.org/!

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Shay:

Ever felt those awkward vibes when religion and money come up? You're not alone. Welcome to Yahweh's Money, the podcast where we tackle the crossroads of faith and finance. I'm Shay Cook, an Accredited Financial Counselor and the CEO and founder of Crusaders for Change LLC. Join us on our journey as we discuss topics like tithing, saving and conquering debt through religious perspectives. Let's get started. Hey everyone. Welcome back to another episode of Yahweh's Money. Again, we have a special guest with us today, Ms. Janessa, one of C4C's financial counselors. So how are you feeling tonight?

Janessa:

I'm feeling good, feeling good, feeling great, staying warm and staying off the icy roads.

Shay:

Oh yes, please, everybody be safe out there. Some crazy stuff going on in the world with the snow and the ice and the weather and the fires, and the Lord is working it out. We pray for all those families. If you're affected by it, and directly or directly, definitely Godspeed, and we're here praying for you. So, but today we're going to discuss a big financial decision real estate investment versus renting. So should you own and invest in property or is renting a better choice for your situation? We'll explore the pros and cons each, how each real estate investors, or how real estate investors can be good stewards of their profits and then that word again stewards and all through a biblical lens. So stay tuned. So Luke 16: 10 says "Whoever can be trusted with very little can also be trusted with much, and whoever is dishonest with very little will also be dishonest with much." Amen to that. We can apply this verse to renting as a wise and responsible step before transitioning to home ownership and investing. Wow.

Janessa:

Yes, yes, indeed, Renting definitely it gives us. It's almost like a precursor, I think, because it shows us the responsibility of taking care of a property-ish without the responsibility of taking care of the property, if you know what I mean.

Janessa:

But yeah, like there's lots of pros and cons to renting versus buying or buying versus renting, and one of the biggest, I would say, pros of renting would be a lower initial cost. So when you're renting, I mean the initial costs are typically like a security deposit, depending on your credit, maybe first and last month's rent, so that can be kind of high depending on your situation. Yeah, of course, moving if you're moving from one place to another, but the renting in itself typically has lower startup costs, which is so important for a lot of people who are looking for housing Exactly.

Shay:

And affordable housing is a big thing in this country right now. It's so expensive and a lot of people are going back to renting. And you're right, I know, as we rented, whether we were with the military or, you know, outside of the military. I mean, even renting can be kind of expensive, right, If you don't have, like we talked about before the budgeting piece of it, if you're not budgeting for it. But it's definitely not as expensive as a down that 10 or 3 to 5 to 10% of 100, 200, 300, 500,000. Oh my God, it's so expensive and all of the fees that people do not understand goes into it and the fees.

Janessa:

That's the part that I think people forget about when it comes to owning, so, like I think of the flexibility of renting, so you don't have to. Yes, you sign a lease 12 months, depending on where you're staying. Could be a little bit longer, or month to month, but if you're in a mortgage, you're locked in.

Janessa:

You're locked in, yeah, you are locked in, like getting out of a mortgage, mm-mm. So that flexibility of being able to move after a certain amount of time and also changing the facility maybe you want to go down to a one-bedroom or up to a two-bedroom you can do that without having to worry about selling a property and taxes and things of that nature. So it is nice to have that flexibility and um and no maintenance maintenance.

Shay:

That is the biggest thing about owning, that I like, the joys of owning there's. I mean, as soon as we could. We bought this house two years ago and, man, it's like, soon as we buy a house, you figure out, oh, you got a lot of more stuff to do than you plan. You know, even if you get the best inspection and you go literally we were in this house for three hours with the inspector going level to level, room to room, checking every little nook and cranny, and then we get in like, oh yeah, by the way, it's ac. Oh, by the way, this thing, by the way, this thing. I'm like, oh my god, that's what I loved about renting. You know, people just came in and they fixed things, even though I have a story to say when I was living in Omaha, nebraska, we were renting an apartment, I was in the bathroom and I came out, almost knocked somebody out because they were in my house trying to fix something. Oh my god, I cussed that man out. Lord, forgive me. Lord, forgive me.

Janessa:

It's okay, girl, you gotta do what you gotta do.

Shay:

I'm telling you what are you doing in my house right now? It's like why I knocked. Well, I was in the bathroom. What if I came out here naked? So you know those kind of I mean again, the joy is of renting versus owning. At least I know ain't nobody gonna be coming at my house. I pray to god, you know, when I'm owning because unless you got a key, um, but the renting man, that no maintenance is a beautiful thing because man, everything's under your, you know your purview when you're rolling, yes, I think about when um it was after I graduated from graduate school and I lived in the Poconos and I just happened.

Janessa:

I don't know what it is about. When I move, for some reason, the winter of wherever I move is the worst that they've experienced in years. It happened in grad school, when I was in Ohio. It happened in Pennsylvania when I moved there it was like a snowstorm peak of snow, but where I lived, the pilot light for the heat was blown out, so I didn't have any heat in my apartment.

Shay:

Now, if I own that place, I gotta pay for that, you gotta pay for that you can't just call somebody or even if you were renting a house, call your landlord, because I've been there with the pilot line had to call the landlord. Right, at least they showed up. But nah, yes, you own in that case?

Janessa:

yeah, and unfortunately in that case the roads were so bad nobody could come to the house, oh man. So thankfully they took some money off of my rent, because they're like because they sent someone within 30 minutes. It blew right back out, oh god, and they couldn't get back because the snow was so bad. But I say all that to say when, when you are renting, it is the landlord, the person who owns the property, it's their responsibility to make sure that stuff is up to code, to make sure that's taken care of.

Shay:

When you own it, that's on you that's on you and if you ain't got, the money or something happens like janessa's saying, and somebody can't come out for a couple days, which I've had happen in our last house in odenton here in maryland. We were in a town home and I think what back, what back to back, one summer we had no air conditioning for like three days because they couldn't come out. It was the hot, deadest summer. So we were like we all we had to sleep on the first level because it was just too hot to sleep all the way up on the third level. And then one year we had no heat and so it was like all bundle up a couple things had to get some space heaters, so and that was all.

Shay:

And thank god we had planned, had an emergency fund, but sometimes you can't even get somebody to come out because everybody's affected by the same thing. So everybody ain't got ac or everybody's. You know, we were in a neighborhood, it seems like, because they were all built around the same time, so everybody's ac unit went out the same time, everybody's back, everybody. You know water heater went out at the same time, so Everybody HVAC, everybody. You know water heater went out at the same time.

Shay:

So then now you have everybody. Everybody's roof had an issue at the same time. It was just funny how everything was degrading at the same time and you're trying to call people in like, well, I got all these other tickets and so. So there's all these different reasons. But when you're owning, that's on you. When they're renting, you have. There's that responsibility, unless you have one crazy renter. You know owners, landlords, and they ain't going to do what they're supposed to do, but that's a whole nother story.

Janessa:

But then there's legal ramifications.

Shay:

Well, there is, but then you might not have no money to do anything, that's true, that's a whole nother story, but yeah, it's renting.

Janessa:

Renting can definitely provide you, you know that flexibility, low initial cost, low maintenance and in some places and in some situations rent is actually cheaper, Depending on. I mean now, unfortunately, the rent is getting very high, Very high. So if you like roommates and you're okay sharing space, share some space.

Shay:

I told my 24-year-old daughter she's like I don't know when I'm going to be able to rent. I was like you're going to have to get a couple roommates.

Janessa:

Look about to be a lot of multi-generations in one house. Yes, Multiple roommates.

Shay:

And that is okay.

Janessa:

That is okay.

Shay:

There's nothing wrong with that.

Janessa:

Being in a community is beautiful, and some of the happiest places in the world often have communal living.

Shay:

So nothing wrong with living with other people, but in some cases rent is actually cheaper.

Janessa:

Flip side of that rent can go up. So because someone else owns the property, they can determine how much they want to charge and unfortunately rent is not regulated in a lot of places. So there is that other side where it can go up pretty substantially depending on where you live and also with the landlord situation. If you do run into an issue with the landlord and they're problematic, if you don't have the money to take them to court, you're kind of stuck with it.

Janessa:

So renting can definitely give you options, but there are, you know, the cons of it is because it's someone else's property. If you're in a house, they want to sell the house. You got to go, you got to go.

Shay:

Yeah, I hear that story a lot from our clients that you know are in that situation. Or when they tell me about the size of their apartment or even their house that they're renting and their rent is way higher than my mortgage. And I'm like girl boy, son, like really, oh gosh it. It's crazy. My sister and I were talking about that a couple weeks ago. It was like people's three and four thousand dollars a month and I'm like what?

Janessa:

that's way more than my mortgage what does it come with the president feeding you food, or something like why is it so?

Shay:

Why is it so high? Do you have?

Shay:

oh my goodness, oh my god I mean that's why I mean I'm grateful that you know again to god that I can own, because that is a whole another situation. But you know, long-term wealth building comes from usually real estate. Nine out of ten millionaires have made their money through real estate. So you know, but again, god is trusting that in us to be stewards of that. Still, like you know, and having that real estate is great, but I mean it does provide a stability in life and equity and appreciation, which is nice. It's not depreciating like in cars, I mean it tends to increase over time, you know, and equity increases as the mortgage is paid off. So that's a great asset to have?

Janessa:

Yeah, absolutely. I think, when it comes to wealth building, owning property, owning land, should be one of the first things discussed because, like you're saying, it's an appreciating asset and it's physical. Yeah, like we don't talk a lot about the asset and it's physical, yeah, um, like we don't talk a lot about the uh. Don't get me to line about what the actual word is. I think it's a uh commodities commodities yeah yeah.

Janessa:

So like having that physical thing that is an actual asset is so beneficial because I mean, I don't want to say what if the world goes into shambles, but if you literally have land, if anything, you have land you can grow food on that land, you can live on that land, it is yours and wealth wise like it, appreciates over time, and it is something that you own. So having real estate, having property, is so important if you are trying to build that wealth and generational wealth is something you can pass down from family to family. It is something that can continue to contribute way past.

Janessa:

you know you being here, but you know, yeah, that that long-term stability in life and that appreciating asset is so huge with owning that land I mean that's why I think a lot of wars are started from the power of that and the land.

Shay:

I mean that's what we're seeing overseas right now. Right, it's been going on for generations is that land god's not getting, creating more land people? What we got here unless you're going to go to another universe or planet Mars or something, and on this earth we ain't got no more. It's there, that's it, that's it.

Janessa:

Unless you figure out a way to live in the ocean, I don't suggest it, ain't no telling what's down there y'all.

Shay:

I mean especially what's going on right now. We'll stay away from that.

Janessa:

It's so big, Like there's so much. I think they say we've only discovered like 20% Of the 70% of the world Like?

Shay:

is winning it like 70%? Or am I thinking about water or the body?

Janessa:

I want to say the majority of the earth is covered by water.

Shay:

Yeah, yeah, majority of the earth is covered by water. Yeah, yeah, only like discovered or explored 20 percent, right? I love watching those documentaries on that. Yeah, I didn't know.

Janessa:

Nasa was created to discover, to study the ocean.

Shay:

Oh, initially, yeah, it was originally studying the ocean.

Janessa:

Then they decided to study space. Wow, why? Either way, unless you can figure out how to live in the ocean, there's not going to be any other place where you can have physical space. Yeah, exactly.

Shay:

And so if your family can give you, pass that along, that is a blessing. Or if you can go buy some land, buy some property, and now the property or the houses they put on the land is like you know, I mean especially here in Maryland. Yeah, and I'm even talking about my own house. We bought this nice big home, but we ain't got much land because there ain't much land out here to give, like you know, so it's. And if it is, it's not usable.

Shay:

It's marshes, swamps, it's like you know all of that stuff, too, has to be considered. So you know, but real estate can be rented out and generate passive income too. So we get, we buy that land, we buy that real estate can be rented out and generate passive income too. So we buy that land, we buy that real estate. Now we can rent it out and make more money, right? So it helps with that generational or that long term wealth building.

Janessa:

Absolutely. I love the when people want to utilize their property to potentially bring in additional income and then if you have the ability to buy more than one property, then you're building that portfolio and building multiple streams of income, which is very important and helpful because it allows you to not be dependent on just one stream. So yes, renting it out and the tax benefits.

Shay:

Oh my.

Janessa:

God yeah those taxes.

Shay:

If you can get benefits with taxes, get it For real. We see the celebrities that have enough money in their bank account to buy a house, but they're like nah, I'm buying this and getting a mortgage because I need that tax deduction. So there's a reason why these celebrities have these mortgages still because that tax benefit is huge tax benefit is huge, absolutely, absolutely.

Janessa:

So, yeah, there's. There's pros and cons for each of them. I think it just depends on the situation. It depends on what you can afford. That's why budget is important. Um, but then also like goals so you don't have to like, if you're renting now, that doesn't mean you're going to rent for the rest of your life, yeah, and if you buy a property now, it doesn't mean you will never rent again.

Shay:

That is so true.

Shay:

Because I know people who have sold their property and went back to renting because they're like I just don't want to deal with it anymore, Especially people as you grow older, like my mother-in-law and people I talk to, they would love to pass it along, but they're like you know, they would love to pass it along, but they're like you guys are good, you guys got your house. Now my mom, she only has one kid. I only have one kid. And so you know, and they, my daughter's like I don't want this house. So I was like okay. So, yeah, she wanted to do her own thing and I appreciate that. So you know. Then they're like well, maybe I'll just go back to renting, cause, as you get older, all of the maintenance, all the stuff we already talked about, it's a lot, it's a huge burden. It's a beautiful burden and beautiful blessing, I say. But I was thinking the other day I was putting up Christmas lights, I was on the ladder and I was like I'm 46. And so I turned 46 in December. It's the last month.

Janessa:

And so thank you.

Shay:

And so I was on this ladder putting up these Christmas lights. It was funny because my neighbor was like you can do everything. I like being outside. My daddy was one of those. Get outside, I like to do the grass stuff. My husband helps go too. Anyways, I'm on this ladder and the ladder is really heavy and I had to get my husband to move it or whatever. I'm like, if I'm 60, 70, I am not getting up on this ladder putting up these lights. I'm not going to be doing a lot of things like when I'm crawling, like when my bug guy comes and goes in the attic. I'll go up an attic with him and check things out. I'm like I'm not gonna want to climb up in this attic at 70. No, I mean.

Shay:

I mean, hopefully God is my body still and functioning well, you know I'm saying that part but I'll just like, oh my god, just like just filling my knees and you know all the kind of cramps and stuff you get now and you get older and um, but yeah, I'm just thinking about that. So I'm like maybe I'm gonna have to rent later or maybe you know, and maybe still keep the house as an asset, rent it out, but then rent somewhere else, so somebody can take care of the maintenance and hire a house manager or something or build a tiny house my husband's always watching those videos they're so cute they're amazing.

Janessa:

They're amazing and it's like it could be the size of an apartment. Yeah, but you own it. You own it, but yes, that that definitely. As you know, as we grow older and wiser, you know we may not be able to do as many things to upkeep properties.

Shay:

Yeah.

Janessa:

Owning that is a long term investment.

Shay:

Yeah, because while it depreciates in value it still costs money to maintain it. Yes, exactly, and people forget about all of those fees that go into.

Shay:

You know we even talk about that. People forget about all of those fees that go into. You know we even talk about that. But owning real estate and outside of the closing costs is a you know, down payment. All that I always tell people you guys need to have some kind of um oh God, I'm about to blink on it Um, reserves.

Shay:

Yes, for all, you know you have an emergency fund. You need to have a reserve fund on top of that, because when we was COVID AC, whole HVAC, water heater, roof we had to replace all in one year. Oh my gosh, that's so bad and I ain't rich, okay. So I was like, thank god. When USA came out, like, oh well, some of this might have been damaged from a storm previously, so we'll cover half of that. I'm like, thank you, but a roof is like 15 to 20,000. So we still had to come up like 7,000 there. Then literally the HVAC, and then I mean all these things started happening. But but God right, because guess what, A year or two later we sold that house for record profit.

Janessa:

And because we had all that stuff taken care of.

Shay:

The new owners come in, or the buyers they didn't have to do an inspection because we had all that.

Janessa:

So God knew what he was doing, he had a plan, but I was like I cannot believe we were hit with a roof, an HVAC, a water heater all in one year.

Shay:

It was crazy. That's why I told people you gotta have five, ten percent of reserve funding on top of whatever your house costs. That five ten percent of the house value annual savings, because you never know absolutely yeah absolutely like down payment is not all you need when you're getting a house.

Janessa:

So when they're like, oh yeah, I'm, I want to save x amount for a down payment, I'm like, okay, how much do you have beyond the down payment? They're like, no, that, that's about it. I'm like, well, you also have to consider um, you want an emergency fund.

Shay:

You also want money for maintenance, you also want money for closing costs and money for moving, exactly because what about all the windows that you want to put in all the furnishings and?

Janessa:

all that are you going to be house for?

Shay:

you're going to be in this house. You ain't got nothing exactly exactly.

Janessa:

There's so much more that goes into owning a house besides the mortgage. Exactly that's what. That's what we have to pay attention to. Like it's great to own a house.

Janessa:

I do think, if you have the ability to and the stamina to own a house, that's great. But before doing it, look at all of the um, look at all the aspects of owning a property, because it is just more than a monthly payment. It's more than that and that's the biggest difference between renting and owning. Renting, you just pay that monthly payment. That's it. Owning it's much more.

Shay:

It's much more.

Janessa:

And then what?

Shay:

if you do have real estate profits, you know God wants us to be a good steward of it. So not only should we be generous as our profits increase, we should give back and share what God has blessed with us, but also you want to maintain your integrity, operate with honesty when dealing with tenants to keep your property safe and maintain. As we said, there are some. What is they called? Not loan sharks, what are they? Landlords?

Shay:

Slumlords Slumlords that's the word Yep, and so we don't want to be out here slumming it. We want to be honest when we're dealing with our tenants and keep it safe and maintain, and not just go up on prices just because you know what the profits god has given to us, and we need to do the right thing yeah, absolutely, and and like with the price gouging.

Janessa:

Unfortunately, so many people who own properties are doing that, which is making it difficult for people to live. To live like, yeah, if you have the ability to, if you are renting out your space and you're making profits, I think the best example of if you don't need to, why is um, the owner of the amazon t, who said he's never going to charge more than 99 cents he's like for making good money. Why would I change that? If you own a property and you're making great money, why price gouge? Why make it difficult for the residents, especially if you have great residents, if you're a great landlord, you will have loyal residents.

Janessa:

They will make sure they pay you on time. If there are any issues, they're going to try to work with you. If you create the space that allows them to live a flourishing life, then they're going to make sure that that property is also flourishing, because they recognize other places are not the same. So please avoid being greedy. You know, let's not be greedy and it's nice to do updates and things to your properties. But getting caught up in making things overly luxurious, that's when you start getting into that overspending and doing more than what's possibly needed, because then if you're putting all that in your house, then you're going to start charging more and you could outprice yourself. Now your profit is gone and you've got this property you can't afford anymore. Definitely plan for your you know plan for your future and when you're reinvesting, reinvest wisely and try your hardest to be ethical.

Janessa:

Like, money is an inanimate object and it's just a tool to cover needs and wants. That's all it is. So if you're able to live a thriving and flourishing life, just ask yourself what would be the point of charging more or doing more or making it difficult for others like what is the point? What is the point? Yeah?

Shay:

and I'm just going to reiterate what Luke 16: 10 says, as I said at the top of this episode, is "Whoever can be trusted with very little can also be trusted with much, and whoever is dishonest with very little will also be dishonest with much." So we want to be, you know, honest, we want to be trusted, we want to do right with what God has given us.

Janessa:

So yeah, any last words? Yes, I would just say, you know, don't, don't jump into something too fast just because others are doing it. It's OK to take your time.

Shay:

Yeah.

Janessa:

And, like I said, if you want to own a property and you rent right now, that's absolutely possible. And if you own a property and you're like I can't do this anymore, it's OK to sell it Exactly.

Shay:

No shame, no, shame Do what's right for you.

Janessa:

Back to it Exactly no shame, no shame Do what's right for you Exactly.

Shay:

Hey, that's it. There you go. Well, that was amazing, Janessa. Thank you so much.

Janessa:

Thanks for having me.

Shay:

Yeah, Y'all have a good day. We'll talk soon. A big thank you for listening to this episode. We hope you found today's chat about the intersection of religion and money insightful. We would love to hear your feedback. Hit that subscribe button or follow the podcast and please feel free to leave us a review. For the latest Yahweh's Money content, visit us at www. crusaders4change. org or find us anywhere you listen to podcasts. Until next time, stay financially fit and spiritually inspired and remember it's always better Yahweh's way.

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Shay Cook

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Janessa Siegel

Guest