In the past few months, we have had the pleasure of collaborating and meeting with homeowners that are dramatically challenging the normal paradigms of property ownership.

Just to give you a sense -

• A 20-person group of startup founders and tech workers buying 200 acres of land in Northern California in order to develop a recreational park with mix of communal and personal-use structures
• The owner of a digital brand agency running her company out of a fly fishing motel she purchased in the Catskill Mountains of New York
• A documentary filmmaker and his family buying a single lot with two structures on it in Maine with another family to renovate both structures and live side-by-side

These folks are approaching home-buying from a perspective that’s more about creation than consumption. They’re using their housing budget to create community, or to create new spaces, or to create new combinations of structure, purpose, and impact.

Their home-buying journeys require a meaningful amount of incremental work - research, analysis, planning, and execution relative to the traditional path to homeownership. There’s also probably some incremental element of risk and possible reward. To use an old fashioned word - what they’re doing takes gumption.

At Stuga we often debate how to succinctly describe who our ideal customer is. That’s not to say we don’t know who they are, we do; it’s just more of a “you know it when you see it” kind of thing. But we have begun to refer to the pioneering buyers we work with as entrepreneurial homeowners.

The Entrepreneurial Homeowner

There are many ways you can define entrepreneur. (It’s true, you can Google it). Most of them are bad. The one that’s most interesting is entrepreneurship is the pursuit of opportunity without regard to the resources controlled.

The entrepreneurial homeowner, then, is someone who’s taking action in order to do something unconventional, creative, or purpose-driven with their housing budget. They are configuring homeownership in a customized way for their own life and how they want to live and own.

Nearly all examples of entrepreneurial homeownership exhibit two key features:

Elasticity of occupancy: blending occupancy types for a property (hybrid vacation-investment property) and fluidity of occupancy types through time (flipping between primary residence, investment property, and sometimes back again).

Flexible ownership structures: they are devising ways to divide space and time within and between structures in bespoke ways. They include multi-party ownership arrangements that are flexible, time-bound, with defined membership rights and responsibilities.

Not all examples of entrepreneurial homeownership need to be as ambitious as a 20-person, 200-acre compound in the Sierra Mountains. In fact, many might already seem commonplace:

• An unmarried couple buying a condo together
• An extended family group buying a vacation home together for regular get-togethers
• A friend group buying a hybrid getaway/rental investment outside of NYC

To the extent that these seem normal shows how far we have come in this transformation.

But it’s still really hard to buy and own outside the traditional paradigm. The housing system wasn’t configured for how they wanted to own. So the “resources controlled” are, to some extent, not available to them in pursuing their particular homeownership opportunity.

To better understand why, we need to understand how we got to where we are today.

Mid-Century, Non-Modern

Homeownership in the US isn’t just a way to consume shelter. It’s a dominant cultural concept, one that’s ingrained into our mental makeup from an early age.

Our culture of homeownership tells us there’s only one model of homeownership: a single family home (preferably detached), designed and constructed to house a nuclear family, located within commuting distance of an employer, governed by the marriage contract, and financed with a 30-year fixed rate mortgage.

The "traditional" homeowner

The 30-year fixed rate mortgage, which is how 90% of US homes are financed, isn’t a product of free market capitalism. Far from it. It’s a creature of government policy, a product that wouldn’t exist were it not for extensive federal subsidies.

And while it’s not a product of pure capitalism per se, it is a product of its age, coming about as it did in Mid-Century America, an era characterized by mass production, consumerism, and conformity. (It’s no wonder that, in the parlance of the mortgage industry, it’s known as the “traditional, conventional, conforming” loan.)

And the subsidies that underpin it are themselves vestiges of a system that was created in a top-down way: first as a response to the Great Depression, and then later as part of a domestic mobilization of housing resources in the aftermath of World War II (federal home-building programs, the GI Bill, etc.,).

Post-WWII Government Housing Policies

All told, our housing system was built for a more static era, where people moved less and traveled infrequently. They held onto the same job for most of their careers and worked in the same office five days a week. There was only a singular definition of what a household is - the “traditional” one. And Uncle Sam was heavily involved in setting the whole thing up.

Massive Change on the Horizon

We live in an era of dramatic change. The magnitude of change in every era probably feels unprecedented. But what differentiates ours is the velocity of change.

Our institutions are still grappling with the impact of the internet, social media, globalization, and a changing US population. But even this list is already starting to feel passe. We’re probably only at the beginning of our tech-driven era of change. On the horizon are an even more profound set of changes that will alter society in the next 10 to 20 years.

As a result, many of the systems that were built for the previous era are beginning to creak and crumble. Nowhere is that more true than in our housing system.

The older “traditional” model of homeownership isn’t going away. Nor should it. Though assembled in a top-down way for a different time, the forces that sustain it are too strong. But increasingly, a parallel category of homeownership will be built up alongside it that’s filled with people in pursuit of homeownership models that look different by comparison.

And in doing so, these innovative homeowners will help us rebuild our housing system and adapt to a new era - from the ground up, as entrepreneurs have always done.