THE BEST INVESTMENT YOU CAN MAKE

WELCOME

Hello! Here’s a quick note before I’m headed to Austin where I’ll speak at a HousingWire event (and also to knock out a few podcasts along the way).

My trip got me thinking about what we’re talking about today, because every room I walk into right now is full of people arguing theory. Oh, my stars and stripes, it’s nothing but markets, rates, and timing when the real conversation should be about strategy. I’m talking about what actually works in real life.

So today, I want to walk you through exactly what I’m doing with Grandma’s house, why Lucas is moving into it, and why I will go toe-to-toe with any financial professional who tells you there’s a better investment for your kid than real estate.

STORYTIME WITH GLENNDA

The Grand(ma’s House) Finale

Now, I know y’all have been waiting on the big reveal for the grandma’s house I bought as an investment property a few months ago. Before I share what happens next, let me reiterate that I will never stop encouraging everyone to buy that solid house owned by the little old lady. And that’s even when it’s a little old lady who smoked like she was being paid by the cigarette. (The smoke can be fixed, I promise.) The thing about a grandma’s house is that they’re always just sturdy as can be and most of the problems are cosmetic. I will take a quality dated house every day and twice on Sunday, because they just don’t make ‘em like this anymore.

The intention was I’d rent out this house, but as it turns out, that’s not what’s going to happen. Instead, I’m moving my son Lucas and his roommate into here. Let me explain how this actually came together, because on the surface it sounds like a sentimental decision because I improved it so well I got attached to it. No, ma’am, that’s not the case. Buying Grandma’s house was always a strategic move and the way it’s playing out now is exactly why.

Lucas currently lives next door. By moving him into Grandma’s house this week, this frees me up to go into his current house and do the work his place actually needs. I’m talking upgrading closets, redoing the bathrooms, updating the flooring, kitchen, and the garage situation. (It’s currently a one-car.) It’s all cosmetic and this will be a 30-day project, give or take. When it’s done, that house goes back into the rental market in a completely different position than it’s in right now.

So already, just in the first move, I’ve got one property improving another. That’s what people miss. Real estate isn’t a one-off decision. If you do it right, it’s a chain reaction.

The Conversation Nobody Wants to Have About 529s

Now, this is where people get uncomfortable, because I’ve said this before and I’ll say it again: if you’ve got young kids, I would rather see you buy a house for them than put money into a 529, which is a college savings fund.

I said that exact thing a few years ago on a podcast, and oh my stars, did it get attention! I promise I was not prepared for the reaction I’d get. In fact, Rachel Cruze, Dave Ramsey’s daughter, made a whole response video about it, basically questioning who I was to even suggest something crazy like that. Our squabble hit something like 17M views! We were making video responses to each other, but she ignored my offer to come to Nashville and sit down across from her in her studio to have a face-to-face conversation. Hmm…

Anyway, here’s my issue with the 529 conversation: when you put your dollars in this kind of account, it assumes a very specific future for your kid. It assumes he or she is going to go to a traditional college, that the structure of higher education is going to look the same in 15 or 20 years from today, and that the cost-benefit equation will still make sense.

Guess what? None of those things are guaranteed anymore. 

What is guaranteed is that your child is going to need somewhere to live, and please, Lord, don’t let it be in your basement. So, if you buy an investment property, put it in a trust, and earmark it for your child, now you’ve created something that grows in multiple directions. Think about it: you’ve got appreciation, you’ve got rental income, and you’ve got someone else paying down that mortgage the entire time. Then when your kid is of age, you’re not handing them a single-use account. You’re handing them options. They can live there, they can rent it out, or they can sell it and use the equity to start something of their own, including a mid-six-figure college degree. That’s a completely different starting line and it’s light years ahead of their peers.

The Mathy Part Rachel Wants People Want to Ignore

Folks love to debate this philosophically, but as always, it’s the numbers that matter. For example, I bought a townhouse in 2013 for $185,000. By the time I was into it with improvements, it was about $215,000. It rented the entire time, positive cash flow—$2,500 a month against an $1,800 mortgage. Today, that same property is worth around $570,000.

And here’s the key detail: I didn’t invest $570,000. I invested only a fraction of that, and the asset appreciated on the full value.

That’s the difference between leverage and just putting money into an account. Your $80,000 down payment is working like a $262,000 asset. You don’t get that kind of multiplication in a 529, and you definitely don’t get the added benefit of income along the way. (Again, Rachel, my schedule is flexible when you’re ready to have a real chat.)

Why Owning the Home Next Door Changes Everything

Now layer that thinking onto Grandma’s house, because this is where it gets interesting over time. That property sits next door to another house I already own where Lucas presently lives. That means I now control both parcels. This isn’t just convenient; it’s strategic.

Ten years from now, Lucas has choices most people don’t have. He can live in one house and have the other one rented, covering his expenses. He can keep both as income-producing properties. Or, if the highest and best use of that land changes, he can combine the lots and build something entirely different. I didn’t create that kind of flexibility by accident. I created it by thinking ahead and stacking decisions that work together.

What This Really Comes Down To, Rachel

People (ahem) will still argue that the stock market can outperform real estate, and on paper, sometimes it can. If you’ve put your money in an AI play, I’m sure it’s paying off in spades. But if you were all in on, say Kodak or Blockbuster, it sure didn’t. That’s not the point. The point is control and durability.

A house is something you can improve, refinance, rent, or hold. A house gives you time. And as long as you’re not in a position where you’re forced to sell, time is the most valuable thing you have in any investment.

I sometimes get the argument, “Now Glennda, how are you any different than those big corporations that buy houses?” The difference is, I’m not buying homes that I expect people to rent their whole lives. I invest in properties that are a bridge to homeownership. My rentals are meant to be a waystation on my tenants’ path to buying their own place. (And when they’re ready to buy, guess who they call?)

That’s why I’ll stand on this all day. Buying Grandma’s house was about setting up my next ten moves before most people have even made the first one. The best part is, you can do this, too!

@glenndabaker

How buying your kid a house will pay for their college! #GlenndaBaker #RealEstate #AtlantaRealEstate #CollegeEducation #RealEstateInvestin... See more

GLENNDAISM

Today’s Words of Wisdom

GLENNDA BAKER & ASSOCIATES

Like Gold (Springs) in Your Hand

Let me tell you about 139 Gold Springs Court in Canton, GA, because this is the kind of house people say they want… and then wait too long to actually go get. It’s sitting in Bridgemill, which is one of those communities where your lifestyle is handled for you. Swim, tennis, golf, the whole thing, and you’re in the estate section, so you’ve got space and presence, not houses stacked on top of each other.

Now here’s what I love: primary on the main, which means this house works today and ten years from now. You’ve got a pool, so you’re not trying to retrofit “fun” into your backyard later. And then there’s the unfinished basement that’s already pre-planned, which is my favorite kind of opportunity because you get to decide what that space becomes instead of paying for somebody else’s bad decisions.

This is one of those homes where you’re not just buying square footage, you’re buying flexibility. And in this market, that’s the difference between something that holds its value and something that actually grows it.