Thoughts on a house hack with a duplex?

[Aris Alexiou]

Hey fellas,

I went to see a duplex today near the very desired to live area of downtown today. This is potentially my first investment.

I wanted to buy it as house hack it. I run the numbers on it and they seem ok i think... I was looking for some feedback and get some suggestions from fellas that are steps ahead of me.

Here are some details.

Asking Price: $380,000
Potential Rent: $1,300-1,350 (2 units total, but 1 for me to live in)
Initial Investment = $38,000 (down payment) + $5,000 (closing costs) = $43,000

SCENARIOS

1) While I live there:

Monthly Expenses:
Management: $0 (only property that I would have, so i can solo it)
Repairs Maintenance: $100
Taxes: $175 (4% tax, SC law)
Insurance: ~$100
Reserve: ~$100
Mortgage: $1,584 (w/ 10% down @ 3.75%)

Total Monthly Expenses = $2,058

Monthly Income:
Rent: $1,350
10% Vacancy (being conservative) = $-135
Total Monthly Income = $1,215

Net Cash = $-843

Comments: Note that current I pay $1,500 in rent which I am getting out of in March. This house-hack would save me about half of my monthly living expenses which is why I find it very attractive. This way I can save up more capital and go towards the next deal in a year or a bit more.

2) After I move out:

Monthly Expenses:
Management: $0 (only property that I would have, so i can solo it)
Repairs Maintenance: $100
Taxes: $350 (6% tax, SC law)
Insurance: ~$100
Reserve: ~$100
Mortgage: $1,584 (w/ 10% down @ 3.75%)

Total Monthly Expenses = $2,234

Monthly Income:
Rent: $1,350 x2 (after a move out, maybe 1-2 years)
10% Vacancy (being conservative) = $-270
Total Monthly Income = $2,430

Net Cash = $196

Cash on Cash ROI = 5.47%

Comments: In all these calculations I tried to be conservative. I used high reserves and maintenance I believe as the properly was just rehabbed and "should" have too many things to fix. Also the 10% vacancy is a big excessive i believe. I know 5.47% CoC ROI is not considered great in the rental world but i really like the deal due to the house hack potential which will allow me to get into the next deal a lot quicker. Also note that this assumes I will pay the full asking price of $380,000 which I will of course try to offer around $350,000 which will bring the CoC ROI to a healthier 9.64%. This property is also located on one of the best school districts in the area.

Edit: Forgot to mention this lot has permission to add another structure in the back side of it like a 2/1 down the road.