Vandwelling Economics: Part Two
This is the second part of a two part post about the economics of vandwelling. In the first post I itemized the long-term costs of home ownership. I wanted to point out that in the long-run, owning a house is a gigantic amount of money. There were lots of very helpful comments about the post so I wanted to write this follow up post to address some of them, and specifically to directly compare the cost of living in a house for shelter versus in a van for shelter. All my assumptions are based on living in a van. If you are living in an RV, your costs will be higher, but still much less than living in a S&B. If you are a little bored with the whole subject, I won’t be the least bit offended if you skip it altogether or just skim through it. You may want to just jump down to the final paragraph where I summarize the numbers.
Next, let me say that I am totally convinced that when you compare the costs of living in a stick and brick (in this post I am going to abbreviate that as S&B because I am lazy!), when you compare the costs of living in a S&B to the cost of living in a van, the S&B is enormously more expensive. Let me clarify, because I wasn’t clear in my first post: I am comparing the cost of providing shelter, not the total cost of living.
For example, most of us want to include the cost of traveling in the comparison, but that is comparing apples and oranges. Traveling is entertainment, it isn’t a housing cost. If you live in a house, and you spend $3000 on a trip to Australia, you don’t include that trip in the cost of home-ownership because you know it is recreation (something you do for fun), it has nothing to do with the cost of finding shelter. But for some reason, when we move into a van we want to include the costs of traveling for pleasure as a cost of living in the van. It is still recreation (something you do for fun) but we can’t seem to help thinking of it as the cost of vandwelling.
Another example is food. You are going to eat whether you live in a S&B or in a van so I am not going to include it. A can of chili is the same price whether I live in a S&B or in a van. I cook in my van exactly like I cooked in a S&B so the cost of the food is not a cost of providing shelter.
I am also not going to include the cost to operate the van. I am going to own a motor vehicle whether I live in a van or in a S&B. The cost of insurance on the van is not a cost of providing shelter; it is a cost of transportation because you pay it even if you live in a house. In the same way the gas you burn driving to work is not a cost of providing shelter, it is a cost of transportation.
In fact, for most people, the cost of transportation should go down when you live in a van, Most of us commute to work and when you live in a van you can park closer to work. That’s what happened to me when I moved into a van. When I lived in a S&B I had a 10 mile commute to work, but when I moved into the box van I parked less than a mile from work. My cost of transportation went down after I moved into a van, not up. Now that I am a boondocker, it is even lower still. I can easily go a week at a time without driving the van which dramatically lowers my cost of transportation.
Cost to buy the shelter. Of course there is a huge range of costs so there can’t be a single answer. I goggled “average price of a home in the us 2012” and it looked like it as in the ball park of $280,000. Of course most of us can’t pay cash and have to take out a mortgage (did you know that word literally means “death grip”?). I used this tool (http://cgi.money.cnn.com/tools/mortgagecalc/) to calculate the payment of a national average payment and it came to $1671 a month for mortgage, insurance and taxes. That’s the national average, but I am sure you can buy a home for less, maybe even half.
I am going to use my own life as a sample for the cost of vandwelling. I just paid $4,000 for my 2001 Chevy extended cargo van, and I think it is pretty easy to find good vans for that price. The solar power system cost $700 and my 12 volt compressor fridge cost $400. I would guess the cost of converting it (bed, propane stove, lights, shelves and miscellaneous) at $400. That brings the total cost to buy a van to live in at $5500. That’s just an average deal, you can buy and convert nice van for less, easily half that much. My first van cost me $1500 and I lived in it for 6 years. That was pretty cheap shelter!
Cost of Utilities: I did a lot of research and found it nearly impossible to find a total national average for utilities on houses. The one hard fact I found was that the national average for electricity per month is $110 per month (http://www.eia.gov/). That still leaves heating (fuel oil, propane or natural gas), sewer and water. I am going to make a wild guess and say they average $100 a month. That brings the total cost of utilities at $210.
In a van the cost of utilities is tiny. Electricity is free because it either comes from solar or from the vans alternator. Sewer and water are also free since most of us find it free around town. Some vandwellers do use propane for heat but it is pretty hard to figure out how much it costs. I am going to guess 10 gallons a month for 3 months a year. That totals about $100 per year or a monthly average of about $8 I am not including the cost of ice because I included solar power and a 12 volt refrigerator in the cost of the van. The cost of your cell phone is the same whichever one you are in. Internet is about the same (or many vandwellers can get by with free wifi). The cost of Cable TV is recreation and not a cost of housing.
Maintenance and Repairs: Like everything else, it is very difficult to estimate exactly what the monthly cost is to repair and maintain a S&B home. This website was very good but still not very definitive: http://www.freeby50.com/2008/12/what-does-home-maintenance-really-cost.html
The best estimate I can come up with is $100 a month. I know that seems much too high, but that is because most of the time you spend nothing, then all of a sudden you may have to spend a lot. The refrigerator breaks; you have to paint or re-side it; you need a new roof, the hot water leaks and makes a mess of the basement and so on. And we tend to forget the minor costs. For example you have to buy, maintain and put gas in a lawn mower. None of that is free.
You will probably disagree with this, but I am not including the cost of maintaining the van. Once more, that is a transportation cost and not a cost of providing shelter. You are going to pay it no matter where you live. The repair costs of the house section of the van are virtually non-existent. Virtually the only thing that can break in my van is the 12 volt fridge, Coleman propane stove or inverter. I will just pick a number our of the air: $10 a month.
Summary of cost of living in a van versus the cost of living in a S&B:
TOTAL COST TO BUY A HOME:
- Van: $5500 and no payments
- S&B: $28,000 down and $1671 a month payment ($20,000 a year) $48,000 total your first year.
TOTAL UTILITY COSTS:
- Van: $8 per month
- S&B: $210 per month.
COST OF MAINTENANCE AND REPAIRS:
- Van: $10 a month
- S&B: $100 per month
So there are the best numbers I can come up directly comparing the cost of shelter living in a a stick and brick house versus living in a van. We all have to reach our own conclusions but for me there just is no question that I can not afford to live in a house. I hope to never do it again! Bob