What Kind of House Would You Get if You Paid Cash From Your $20,000 annual income?

by Katy on January 10, 2013 · 33 comments

It may be slightly over ten minutes, but the following video is totally worth your time.

Not just because the man in the video, (Sorry, but I’m unsure of his name) bought land and then built a small home in Hawaii with cash, but mostly because of what he talks about.

It’s wonderful. I especially like what he talks about at the 8:10 mark.

Katy Wolk-Stanley

“Use it up, wear it out, make it do or do without.”

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{ 33 comments… read them below or add one }

Dan Garner January 10, 2013 at 10:55 am

That is great. When I was in the Navy, we would visit this small island in Italy and the same house was being built for like 15 years. They built with cash, few Europeans borrow a mortgage like we do.

I hope to do this when I settle in Colorado.

Dan @ ZenPresence.com


Katy January 10, 2013 at 10:59 am

I would be so happy to live in they house for my retirement. Of course, in Colorado you’ll need insulation and heat!



Dogs or Dollars January 10, 2013 at 11:11 am

I love him! And this was really just the inspiration I needed today to keep my non-consumerism going. Thanks for sharing.


Katy January 10, 2013 at 11:25 am

I needed it too. And I felt good when he talked about how people refinance their mortgages and never get closer to paying them off. We had been doing that for awhile, but we switched ours to a 15 year mortgage last year, which was exactly 15 years after we bought our house, so we’re back on track!



Dogs or Dollars January 10, 2013 at 1:21 pm

That’s our plan too! We refinanced after 5 years to another 30. Then in another 5 we’ll refinance to a 15. Hopefully ending up with 25 years of mortgage total. But, the best laid plans and all that…


marie January 11, 2013 at 2:31 pm

We just went from a 30 yr to a 15 yr mortgage. We plan to still pay the same amount monthly, since it went down $60 a month. The dream is to pay off in 10 years.
In 1986, I bought a home for $3900.00. When I sold it in 2006, I still owed $95. Never again!


dusty January 10, 2013 at 11:41 am

I agree, that is great. We lived in an RV for 4 years while building our home ourselves and the best time of my life was living in the RV. I realized during that time just how little you need to survive in this world. We bought a brand new travel trailer, paid cash for it, stayed in a local RV park, $400 a month included everything. When the house was done, I didn’t want to move in. Now we have a great big house on a big piece of property, which we have to work hard to pay for and when we’re not working we’re doing yard work or cleaning the house. And, since this is Florida, it’s worth about 60K less than we own on it. One day, I will be back in either an RV or tiny house and enjoying life again.


Renee CA January 10, 2013 at 12:01 pm

We did about the same think. Husband is retired custom home builder and we lived in a single wide for about a year on the property while building. Also lived in a 5th wheel for a few months while building another and in our 1100 sq ft rental for two others. Must say with 3 kids, I preferred the house but we did overbuild, always with the thought of resale, just what we did on the side. It did help me figure out how much we really need (or don’t need). Now looking forward to downsizing but still think I’d like around a 1500 sq ft house or condo as we have 7 grandchildren and I love for them to visit grandma’s house!


Cheapchick January 10, 2013 at 11:45 am

Great video. Thanks for sharing. It just goes to show no matter how much or how little you have, you can still live the dream. You just have to think of a way to do it, and sometimes it takes time.


My Life In Focus January 10, 2013 at 11:48 am

My husband and I built our own home back in 2001, without a mortgage, cash only. Yes, it takes 10 years. Ugh. When I think back. We did get a little bit of a head start because we bought a modular home. But even then, we had to do our own plumbing, heating, electricity….septic, yada. yada. For the first year I had to get in and out of the house on a ladder. Eventually we got a front deck. Then a side deck. And I was overjoyed when we got a back deck. But the house sat for while in the center of a mud pile before we could do landscaping. The house sat smack dab in the middle of 3.5 acres in a rural community. Didn’t know a soul. Knew nothing except WE’D NEVER GET A MORTGAGE EVER AGAIN IN OUR LIVES. HATE BANKERS!!!!!! Just the hatred of the bank inspired us to continue onto our dream of living mortgage and debt free.
Thanks for the video. Enjoyed it.


Renee CA January 10, 2013 at 12:31 pm

We were able to sell a home in the early 1990’s and build another smaller one for cash. Haven’t had a mortgage since. I can’t tell you how wonderful it feels. Thanks to the teaching of Larry Burkett, who has passed away. Like Dave Ramsey today. There is not much you can buy that will make you feel a good as being debt free.


Mr. Everyday Dollar January 10, 2013 at 12:47 pm

Love it! It’s awesome he technically lives in a detached garage and fooled the county into thinking he was going to build a house as well. My mind was blown because the guy built the house over 10 years paying cash as he went. This is completely opposite of what we are programmed to do: take out a mortgage and buy a house which is instant gratification.

This is timely because I just blogged about small scale living (http://mreverydaydollar.com/small-scale-living-in-a-large-scale-world/) where I outline my dream house which is roughly 1,250 square feet.

Thanks for sharing the video!


Krystal January 10, 2013 at 1:04 pm

Absolutely wonderful. WONDERFUL.

I think it was Dave Ramsey who said “The definition of maturity is delaying pleasure.” I constantly remind myself of this as I hope to cash flow a tiny house one day for a second home (heck, maybe I’ll sell this one!)

Great inspiration!


Lisa January 10, 2013 at 2:05 pm

Although we did not build a house, we did buy a house that was smaller (in comparison to the norm in the area), and a fixer-upper. We then fixed it up over the years as we could afford it, and our second salary went to paying the mortgage off asap (meaning we lived on only one income and put the other to the mortgage). We were mortgage free in 6 years doing this (and no we did not live in a cheap area). I think the key for us has been to always live below our means including the housing! It amazed me what the bank said we could ‘afford’ and was willing to lend us for a mortgage – no way was I ever going that deep!
Now, I am on a ‘career break’ which has been no hardship since we have always lived on one income (we are just not saving as much).


hannah wilson January 10, 2013 at 3:05 pm

Dear Katy–
Thank you so much for sharing this inspiring video! I would love to be able to do something like this in Northern Michigan, doubt that the zoning laws would allow it though. What a dream existance.
Love it 🙂


tna January 10, 2013 at 3:11 pm

I remember reading years ago that Burt of Burt’s Bees lived in a chicken coop. It’s an interesting story.


Lori from Michigan January 10, 2013 at 3:25 pm

What a lovely, sweet little house. It would be a pleasure to live there!


Diane January 10, 2013 at 3:47 pm

Boy, did he get a deal….a home in Hawaii…what a dream! I needed this inspiration today as I face a new life as a free agent when my job ends at the end of the month. I’ve embarked on ultra frugal living, eating fresh and light and figuring out how to live without spending time in stores, even thrift stores. Ongoing…. living the good life on little!


Joyce January 10, 2013 at 3:51 pm

My husband and I rented out our 2 extra bedrooms for 4 years to help us pay for our mortgage. It wasn’t the ideal experience but it got it payed for ultra fast. We always fantasize about ” a shack by a rock”; going back to basics. A little home with no payments seems the prize for working hard for all those years.


AFS January 10, 2013 at 4:18 pm

In the late 1940s my father paid $600/acre for two acres about 10 miles north of Seattle. a few years after my parents married they took out a $5000 construction loan. With that they laid the foundation, built the shell of a 5- bedroom 3-bath home. With the shell complete we moved in. It was a work in progress my whole life.It was pay as you go for the whole process. As children we didn’t need monkey bars, we swang from the rafters. Funny we didn’t know we were deprived.


Jeana January 10, 2013 at 4:19 pm

We are in the process of building a 2-car garage with an apartment over it. We’ll live in it while we restore an 1833 stone farm house. Our guest apartment will be approx. 460 square feet. It will be home to two adults with periodic visits from college aged kids. It’s such an adventure and we’re having the time of our lives. All paid for with cash too!


Cheri S January 10, 2013 at 7:32 pm

Katy! What have you done! Actually, I have to thank you for this amazing gift. We have lived in Alaska for 41 years and have visited Hawaii many times to thaw out during the winter. I retired last year and my husband retired in November 2012. We have talked and talked about moving someplace warmer for years. Well, this video finally did it! I just emailed our friends on the big island who made the move 3 years ago to have them scout out some likely pieces of land. We’ll spend the next year getting our big home ready to sell and then we are out of here to someplace warm and tiny and paid for with cash. Mahalo plenty, Katy!


Katy January 10, 2013 at 10:27 pm

Wow, that’s fantastic!



Mary January 10, 2013 at 8:49 pm

Thank you for sharing this! I loved it. Very cool and inspirational. Really makes me think about how much extra crap I have in my house. 2013 is my year to declutter!


Dianna January 10, 2013 at 9:04 pm

Loved this video. He got to live in beautiful Hawaii! Thanks for posting this.


Shelly January 10, 2013 at 11:09 pm

I really liked this video. Thanks so much for sharing it. When my husband and myself married we bought a single wide mobile home with cash to live in, it was 10 by 36. It was small and old but worked as a great home while we saved for a down payment for our next home. When we started shopping for our next home we could have afforded at the time with a mortgage a big home on Mt Tabor. We opted to spend less than half of what the bank would loan us and got a nice 1000 sq foot fixer upper. Friends of ours though we were crazy not to go for the instant nice big home. We have since then sold our little fixer upper and moved to another home and our current home is paid for. Sometimes when we drive past a few homes we could have bought all those years ago I am thankful we made the choice of a smaller home.


JD January 11, 2013 at 6:36 am

We build a home 13 years ago, standard 30 year mortgage, etc. The first thing we realized was that we could not only not afford to build a huge home, I didn’t want to clean one, and besides, our kids were teens — they would be gone out of the house in 10 years or less. We built a modest home of about 1500 sq. feet, refinanced it to 15 years after five years, paid it down as fast as we could, throwing a lot of extra on the principle, and are now mortgage free in a modestly sized home with space for visitors but not a lot of useless space to clean. I love it. My friend who built a large home when we were building our smallish one is now rattling around in it with just her husband and they still have a mortgage to pay.


Ann January 11, 2013 at 6:46 am

My husband, son and I did this in the late 80s/early 90s. My husband had lost his job, we lost our house because the mortgage company wouldn’t work with us but we had 2.5 acres of land out in the country near Austin, TX. We lived on the land in an RV (bedrooms/bath) and small storage building (living room/kitchen) and built the house. It’s a single story 2 bedroom/1 bath and we don’t owe anything on it. It never felt like we were sacrificing any comfort, etc. If we needed space we went outside as there was always something to do out there — the house, garden, going for a swim in the river. For the most part, we bought used building materials and friends donated. It was actually a great time for us.


Amanda January 11, 2013 at 7:27 am

Love, love, love this! My parents paid off their small house 20 years ago. (I was a kid.) I’m always shocked by the people who brag that their first house was $20k or $50k. I say, wow, cool you must have paid that off by the time you were 35! They say, oh I owe more that that on my house now, but I hope to retire when I pay it off (says the 60 y/o).


Audrey January 11, 2013 at 8:07 am

Wow, I love that. He is so inspiring ~ I love how resourceful he was. Thanks so much for sharing! I think his little cottage is shangri-la!


Shelley January 11, 2013 at 11:07 am

I bought a house in SLC in 1993 and paid it off in 2003; I moved to England in 1995 and bought a house in 1996 and paid it off in 2004. I retired from work in 2007. I think being focused on the big goals and not being distracted by what ‘normal’ people do is key. I admire this guy’s determination to live life on his terms, not on the bank’s.


Kymm January 11, 2013 at 12:02 pm

Love this! The house is completely charming, and I like the way this man sees things.


Bauunny January 11, 2013 at 3:54 pm

My husband bought his first house for $2,ooo….not in a great neighborhood but he was young, single and learned a lot about fixing up houses. Fast forward many years. When we got married we both had homes. We sold one and lived in one while we bought a larger home in the country. It was a walk-out so my husband decided he would buy a bobcat for the price of sub-contracting the excavation. His theory was he could do it (even though he had no experience) and when he was done he would own the bobcat. I was skeptical, but that was exactly what happened. He is on his 3rd bobcat (he uses it for snow plowing and for landscaping). We took out a 15 year mortgage. Every time we refinanced, we maintained our original payment amount and then went on a plan where we made a payment every two weeks …..we paid our house off in 13.2 years.


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