When house hacking a multi-family

[Andrew Mowe]

Hey BP community, I’m starting out in real estate in the north east. I want to house hack my first property by buying a multi-family(3unit) to live in and rent out the others.

When analyzing this deal, is it ok if I break even on my expenses (using only 2 out of 3 rents) because I’m living in one unit and sacrificing that extra income? Considering if/when I move out I will cash flow well because that 3rd unit will essentially be 100% cash flow? I would love to get some insight on this strategy as I start to analyze more deals and walk through lots of homes. Thank you all!

[Nicole Heasley Beitenman]

You need to run the numbers both as a hack and as a pure rental because you aren't going to live there forever. Does it meet your investment criteria when you move out? If so, I'd go for it. Paying less on rent or a mortgage is still better than paying full price. And if you're breaking even, you're living for free. That's a sweet deal. Unless, like Daniel said, you can find a better deal, take this one.