House Hacking by Proxy?

[Adam Barr]

Hi, I'm new to BP... still very much in the "gathering information" phase as I learn about real estate business models and investment strategies. I'm active duty military, and any near-term investment strategy I pursue will be long-distance because I don't want to invest in the market where I currently reside.

I know there are many ways to invest in real estate, and the House Hacking strategy appeals to me on many levels... but the requirement to live in the property is an obvious obstacle to me for the reason mentioned above. So here's my question:

Is there a legal way to House Hack by proxy? If I have the financial means to purchase an asset but lack the geographic proximity to live in the property, is there a way to structure a partnership to leverage the advantages of House Hacking and fulfill the residency requirement on my behalf?

- Could that look like me financing someone else's purchase and then buying the house off them after 12mos? If that's the case, how involved does the "second purchase" need to be to keep things on the up-and-up? Could it be a token sale to transfer ownership on paper, or would it have to be a full-fledged sale to avoid flirting with fraud? 

- Could that involve co-signing a mortgage (or something like that) with someone else who fulfills the residency requirement? If that's feasible, I imagine that might look similar to having a resident property manager (in the case of a multi-family property). Thoughts?

Please throw spears, pick this apart, and help me understand the details of this strategy. As mentioned, I'm very new to all things REI-related; just trying to wrap my head around concepts and find ways to apply principles to my specific circumstances. Thanks in advance!

[Linda Weygant]

If you have a college-aged child who is still your tax dependent, they could live in the house and legally fulfill the FHA "living in" requirement. Essentially, this is your second home that your dependent lives in. This is an ideal scenario for housing your college kid. Buy them a house in a college town. Have them live there and manage the rest of their roommate. When they're done with college, keep the place and profit.

(Note:  It's a little more complex than this, but these are the basics)