Is buying a house really a great investment?


August 12, 2020

Plus: Airbnb’s IPO plan is moving forward — finally.
August 12, 2020
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Happy National Middle Child Day. If you’re a mid kid, this may be your only chance to celebrate — because let’s face it, your parents will probably forget your birthday. Again.

Here’s a list of famous middle children, plus the odds that they’re reading our email today:

Michael Jordan (7:1)

Madonna (40:1)

Abraham Lincoln (0:0)

Bill Gates (1:2… we know you’re out there, Billy!)

Road Diary

Why buying a house is a bad idea

I just arrived in St. Louis after spending a week in Utah, which might be one of the most underrated states in America. Next stop: Brooklyn. Specifically, Ditmas Park for a month.

Anyway, I’m looking for a place to live and tweeted my thoughts on buying a home:

My tweet pissed off a lot of people.

I get it. Americans are told to get a job, have kids, and buy a home. After buying it and spending hundreds of thousands of dollars, I call it a silly financial decision.

My point is this: I’ve done the numbers using a wonderful calculator by The New York Times. Compare historical housing appreciation (~5%/year, plus maintenance and other costs) to other investments (equities appreciate ~8%/year).

If your goal is to make money, buying a home is not the best investment. 

But that’s OK — do it if it makes you happy

Historically, homeownership is a great place to store wealth as it forces buyers to save and home values keep up with inflation. But don’t justify it as a moneymaker.

My plan for the next year is to rent Airbnbs in Athens (Georgia), Brooklyn, Asheville (North Carolina), DC, and Austin. 

I’m looking for a city with ambitious people where I can have a single- family detached home. Tweet at me and let me know where else I should check out.

What are your thoughts on buying a house? Read my original thread here. So many good insights (even if I disagree with some of them). 

Also: Do you regret buying your home? Tell me here.

Sam, founder & CEO of The Hustle

P.S. I’m nerding out on what makes the perfect neighborhood. I’m reading Tribe and listening to Michelle Obama’s podcast on communities. What else should I consume?

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Snippets

5 stories to catch you up quick

1️⃣  Airbnb is expected to file IPO paperwork with the SEC later this month.

2️⃣  AmEx is in talks to buy Kabbage, a digital-first small-business lender, in a deal that could be worth as much as $850m.

3️⃣  Tired of copy/pasting into Google Translate? Twitter is testing automatic tweet translations in Brazil. 

4️⃣  The next big-name retailer that’s launching an ecommerce bid to steal some of Amazon’s lunch: Kroger.

5️⃣  Now you no longer need a Wikipedia page to look important: in India Google is exploring a new feature called “people cards” that lets you write a bio to appear when someone searches your name.

And 5 more to delight you 

1️⃣  News of this ancient sea creature with a 10-foot neck means we are never going swimming again.

2️⃣  Face ID is so bad with masks that New York’s subway system is asking Apple to come up with a fix.

3️⃣  Ready or not, the see-through TVs are coming. 

4️⃣  Meet the twirling window washer taking over TikTok. 

5️⃣  Germany’s Krone Circus had to put performances on hold, but it found another way to make money: selling lion dookie. Jars of poop are ~$6, and customers say the turds keep cats out of the garden.

Holey Hell

Trade deals are stalling, thanks to… cheese?

A post-Brexit deal between the UK and Japan might be on hold — all because of wheeling and dealing around blue cheese. 

One negotiator is holding up the talks to win better terms for the famous British Stilton

Talk about a wedge issue 

Holding up a trade deal over some fancy fromage might sound holier-than-thou. But the stalemate highlights just how much cheese exports have matured.

They’re worth ~$70B, and they’ve grown 3% a year since 2010.  

They’re especially important for small European countries. People are so gaga for gouda that cheese exports are worth $4.2B to the Netherlands.

Big Cheese keeps grating deal-makers’ nerves

An EU-Canada pact might curdle because Cyprus wants extra protections for its signature halloumi.

Last year, Italy’s Parmigiano-Reggiano Cheese Consortium — a very real group of cheese bigwigs — claimed that US tariffs would shred ~50k jobs.

Now China is getting cheesy

It’s buying up artisanal cultures like nobody’s business.

Between 2013 and 2018, British cheese exports to China jumped from £67k to £6.5 million.

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SPONSORED

The future of home fitness

Hey folks, Sam here.

With the gym still closed, running has become my go-to — AND I’M BORED.

So, when one of the employees at Tempo dropped off this new, killer AI-powered home gym on my doorstep, I opened that like a kid at Christmas.

It comes with a variety of weights — 150lbs total for strength training. And with a touch screen and 3D sensors, it even tracks your motion and analyzes 25 of your body’s essential joints, giving you live feedback on your effort, your form, your heart rate — it’s pretty amazing.

What I love most about it is that you can challenge your friends to any workout you want, you can see their scores live, and Tempo ranks each player on a leaderboard.

Think of it as your very own fitness video game. 

It makes you want to work harder while doing something cool.

I even challenged some of the insanely in-shape employees at Tempo, and chose lighter weights to give me an advantage 😎.

Spoiler alert: I won.

Plus, take $100 off your order, on me, with the promo code TempoHustle.

Transform your training → Infographic of the day

Talk about an eye-popping run.

To protest the arrest of media mogul Jimmy Lai under Hong Kong’s new national security law, pro-democracy activists did something unusual: They bought shares of his company, Next Digital. 

That led to an 1.1k% surge in 2 days.

Storage Wars

Wanna make that spare closet earn its keep? This startup can help

You’ve got a spare bedroom, but having strangers sleep over feels… weird. No worries — you can still monetize that square footage. 

Neighbor aims to be the Airbnb of self-storage, connecting people who have STUFF with people who have SPACE. 

Homeowners might be its bread and butter, but there’s value in thinking outside the box: Neighbor just inked a deal with a major developer to transform office ghost towns into storage spaces.

The storage biz is all about the 4 D’s 

“Death, downsize, divorce and disaster” keep demand flowing in bad times, as one storage exec told The New York Times.

And what’s a bigger disaster than a pandemic? Students were kicked off campuses, and others gave up apartments to shelter in place with family.

Dumbo Moving + Storage, which has 5 facilities in New York and New Jersey, had 2.6k+ new customers in May, up 35% from last year.

So there’s plenty of space for Neighbor

Its rates tend to be ~50% lower than traditional storage facilities, which charge up to $225/month for a climate-controlled unit.

Neighbor estimates a whole basement can pull in ~$3.1k/year. An empty closet? $384/year.

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This Day In Business History

Via News and Citizen, 1931

On August 12, 1930, the US government approved Clarence Birdseye’s patent for one of the earliest quick-freezing techniques. It paved the way for the ice-cold dishes in the freezer aisle.

A year later, a Vermont newspaper proclaimed that, thanks to Birdseye, “Oysters are kept in season all summer.” (Read more about his fascinating career in this Hustle deep dive.)

The Hustle Says

Want to know how a UFC champ started PlayLine? Join the founders tomorrow at 12pm PST to learn how they partnered with Mark Cuban to build a social media driven empire. Register here.

Can this autonomous mower disrupt the $53B commercial landscaping market? Sure looks like it. Learn more about Graze Mowing over on their SeedInvest page.*

Picking high-quality meat is shockingly hard. Get humanely raised, thoughtfully sourced cuts delivered straight to your door starting at $129.*

Ever claimed your brain is a sponge? Now’s the time to prove it. Get access to over 12,000 on-demand video lectures with a Free Month Trial to The Great Courses Plus.* 

*This is a sponsored post.

2 Truths and a Lie

One of these storylines isn’t real. Can you spot the fake? Click to find out.

  1. Ralph Lauren will sell stylish duds for your Bitmoji, and you can buy ’em in real life.
  2. Speakeasies used to be for cocktails — now they’re for getting swole.
  3. The state of Utah announced a new program that incentivizes travelers to buy more craft soda.
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Today’s email was brought to you by Michael Waters, Caroline Dohack, and Bobby Durben.
Editing by: Nick “American Cheesy” DeSantis, Ray Zsanette (Snack Czar).

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