Owner Occupied multi-family

[Kyle Poodiack]

Hello!

This is my first post on BP and I am very new to Real estate investing. I am currently looking to buy my first home and want to owner occupy part of a multi-family residence. I am in New Hampshire in the seacoast area where there seems to be limited inventory currently. My question is, is it a bad deal not to be cash flow positive if I am owner occupying or should I look for a deal where I can live and cash flow at the same time. (Ideally I would be buying in the next 2-5 months).

Thanks!

[Matthew Dennehy]

Hi Kyle, welcome and congratulations on looking for your first property!  I really enjoy working in the NH market because there are still great deals to be found by those who know where to look. 

For a multi-family house hack, you don’t necessarily need to cash flow while you live there. Your main economic benefit you get from living in a house hack is the significantly reduced living costs. However, if your goal is long term financial independence, you want to make sure you buy a property that will cash flow when you eventually move out. That means running two sets of numbers when buy a property, one set for you living there and one set fully rented. You will only want to buy if it makes sense in both situations. 

With the limited inventory and all the real estate hype out there, you will find a lot of properties that are overpriced and don’t perform well. Avoid those and stick to the properties that make sense. They are out there!  And if you can find something that cash flows positive while you live there, bonus!