The Clark Howard Podcast – Episode Summary Episode: 12.16.24 SAVE MORE With DIY Repairs / Housing Market Update Release Date: December 16, 2024

In this engaging episode of The Clark Howard Podcast, host Clark Howard delves into practical money-saving strategies through DIY repairs and provides an insightful update on the current housing market trends. The episode is enriched with listener questions, offering tailored advice to help individuals navigate financial decisions effectively. Here’s a comprehensive overview of the key discussions, insights, and conclusions from the episode.

I. Save More with DIY Repairs

Clark Howard kickstarts the episode by sharing a personal triumph in DIY repairs, emphasizing the potential for significant savings when tackling household fixes independently.

A. Personal Anecdote: Repairing the Scion XB Hatch

“My friend and I went on YouTube and watched videos of how to repair them. Because this hatch repair at a Toyota dealer was almost $1,000 and for $35 following the YouTube video, my friend and I were able to repair it like new...” ([04:30])

Clark recounts his experience fixing the back hatch handle of his Scion XB, a common issue where the handle often breaks off. By leveraging YouTube tutorials, he and a friend successfully repaired the hatch for just $35, far below the $1,000 quote from a dealership. This story underscores the value of online resources in empowering consumers to save money through DIY solutions.

B. Utilizing Online Resources for DIY Projects

“There's so many little things that cost so much money to have, like a car dealer service center do or have somebody come to your home to fix a lock...” ([05:00])

Clark highlights the myriad of minor household and vehicle repairs that can be handled independently with the help of online guides and videos. From fixing a lock to changing a key fob battery, these small tasks can prevent costly professional services.

C. Listener Interaction: Changing a Key Fob Battery

“You’ve had that. What’d you do?” ([05:40])

A caller shares a common frustration with replacing a key fob battery. Clark reassures listeners by explaining that detailed YouTube tutorials can simplify the process, turning what seems like a daunting task into an achievable DIY project. This interaction reinforces the episode’s theme of self-sufficiency and cost-saving.

II. Listener Questions and Expert Advice

Clark addresses several listener inquiries, providing personalized financial advice across various scenarios.

A. Larry’s Dilemma: Damaged Custom Wheels

“Larry, your daughter talks to headquarters yourself... Always take pictures of fancy wheels before they take your car from you at the tire center so that you have proof of the condition of the wheels before new tires were put on it.” ([07:00])

Larry from Indiana seeks advice after his daughter’s custom wheels were damaged during a tire installation. Clark advises direct communication with the company’s headquarters, emphasizing the importance of documentation—such as taking detailed photos of the wheels before service—to substantiate any claims of damage. This approach aims to navigate corporate bureaucracy effectively.

B. Daniel’s First Apartment Experience

“Your good intentions don't go by the wayside that you're doing that... There aren't that many apartment scams...” ([09:38])

Daniel from Texas, a 23-year-old moving into his first apartment, asks for tips on renters insurance, utility bills, and avoiding scams. Clark provides practical advice:

• Renters Insurance: Opt for policies from familiar insurers rather than those sold by apartment complexes.
• Utility Bills: Manually adjust the thermostat to save on heating and cooling costs.
• Avoiding Scams: Focus on apartment communities rather than individual rental listings to minimize the risk of fraud.

Clark also encourages Daniel to continue contributing to his Roth IRA with a set monthly amount, fostering disciplined saving habits.

C. Caitlin’s Landlord Challenges

“It's truly all about the tenants that you screen... having decent security deposits are important when you're renting a property that you own.” ([12:06])

Caitlin from Washington shares her traumatic experience with a problematic tenant who ceased rent payments and caused property damage, subsequently suing her. Clark advises:

• Thorough Tenant Screening: Utilize landlord-tenant screening services to evaluate potential renters effectively.
• Security Deposits: Implement security deposits and consider offering rent discounts for early payments to incentivize reliable tenants.
• Legal Preparedness: Follow legal eviction processes meticulously to protect against potential lawsuits.

D. Charles’s Relocation from Atlanta to North Carolina

“Be comfortable that you and your wife could handle two mortgage payments for a period of time...” ([23:50])

Charles from Georgia plans to move from Atlanta to North Carolina and is exploring financing options for purchasing a new home before selling his current one. Clark suggests:

• Bridge Financing: Consider home equity lines of credit (HELOC) or bridge loans to cover the down payment while awaiting the sale of the existing home.
• Financial Readiness: Ensure the ability to manage dual mortgages if the sale takes longer than anticipated.
• Credit Union Loans: Explore favorable terms through local credit unions, which may offer competitive rates and terms for home equity loans.

E. Cheryl’s Concern About Fidelity App Security

“You don’t have to, Cheryl, because you’ve taken the right precautions... you've got a bullseye target on you if you have the latest, greatest iPhone.” ([26:04])

Cheryl from Oregon inquires about the necessity of removing the Fidelity app from her phone for security reasons. Clark reassures her by acknowledging her robust security measures, such as face recognition and locked-down money transfers. He explains that while smartphone security is crucial, Cheryl's proactive steps adequately mitigate risks, especially since criminals typically target high-value devices like the latest iPhones.

F. Jim’s Inquiry on Expense Ratios in IRAs

“Over the long haul the low expense ratios went out... prefer index funds due to their extremely low expenses.” ([27:44])

Jim from Georgia wonders whether higher expense ratios in his IRA indicate superior fund management worth the extra cost. Clark advises favoring low-expense index funds over higher-cost actively managed funds. He explains that, despite the expertise of fund managers, the long-term drag of higher expenses often outweighs any performance benefits, making index funds a more cost-effective choice for retirement savings.

III. Housing Market Update

In a comprehensive analysis, Clark examines the unconventional trends reshaping the housing market.

A. New vs. Used Home Pricing Dynamics

“The price of buying a new home that historically is 15 to 20% more than buying a used home today is 3% more and in some places absolutely the same or cheaper buying new than used.” ([17:07])

Clark highlights a significant shift where new homes are now priced nearly on par with or even cheaper than used homes—a stark contrast to historical norms. This change is attributed to evolving supply dynamics, with a limited month’s supply of used homes driving prices closer to those of new constructions.

B. Migration to Satellite Communities

“People are moving to what are known as satellite communities, which could be 50, 60 miles away from the core city... you have to think through can you and your wife float two mortgages.” ([17:07])

The trend towards satellite communities—residential areas located 50 to 60 miles from major metropolitan centers—is becoming increasingly popular. Factors influencing this migration include:

• Cost Savings: Housing dollars stretch further in satellite areas, allowing for more spacious or affordable homes.
• Quality of Life: Individuals prioritize factors like lower taxes, better schools, and a more relaxed environment.
• Commuting Considerations: Increased distances necessitate careful budgeting for transportation costs, potentially favoring fuel-efficient or electric vehicles.

Clark shares an example of a large-scale development in Savannah, Georgia, where 2,500 homes are being built 25 miles from the city center to meet growing demand in these satellite areas.

C. Implications for Consumers

“You’re in the car a lot more... how much mortgage debt you might have on it.” ([17:07])

The migration trend impacts consumers by:

• Increased Commuting Costs: Longer drives may require better vehicle budgeting or investment in fuel-efficient cars.
• Retail Shifts: Retailers respond to population changes by establishing new stores in growing satellite areas, enhancing convenience over time.
• Financial Planning: Potential buyers must account for the dual costs of higher transportation expenses and managing multiple mortgages if maintaining properties in both core and satellite areas.

IV. Notable Quotes

Throughout the episode, Clark and callers share memorable insights that encapsulate the core messages of financial prudence and strategic planning.

• Clark on DIY Success: “That's my biggest victory ever with a YouTube video.” ([04:35])

• Advice on Renters Insurance: “I like a policy bought from an insurer you already know or use in your family rather than buying whatever policy the apartment complex may try to sell you...” ([09:04])

• On Tenant Screening: “It's all about the tenants that you screen... having decent security deposits are important when you're renting a property that you own.” ([12:10])

• Housing Market Shift: “I can't think of a time in history... buying new homes now is 3% more and in some places absolutely the same or cheaper buying new than used.” ([17:07])

• Expense Ratios and Investing: “It is so hard even with the brilliance of these managers of these funds, the expense ratio is such a drag on their performance over time...” ([27:44])

Conclusion

In this episode, Clark Howard effectively combines personal anecdotes, listener interactions, and expert analysis to deliver actionable financial advice. From empowering listeners to undertake DIY repairs and save money, to navigating the complexities of the evolving housing market, Clark provides valuable insights aimed at fostering financial independence and smart decision-making. Whether you're a first-time renter, a landlord, or considering a significant relocation, this episode offers practical strategies to help you save more, spend less, and achieve greater financial freedom.

Remember: For personalized advice and more resources, visit www.clark.com/askclark and explore the free tools and services Clark offers to help you manage your finances effectively.