What do you think of House Hacking in Dearborn, MI (FIRST POST)

[Waleed Abdulrab]

Hey all. First time poster here. So I’ve been lingering the forums for quite some time now. I had my account for a few months and I finally decided to post for the first time after countless weeks of scouring the forums for tips and tricks to best succeed in Real Estate. Happy to finally introduce myself and post for the first time. Let me start by explaining my story. My name is Waleed, I’m 25 and live in Dearborn, MI. I work 7 days a week and have $4,000 in savings. I manage to save the bulk of my income by staying with parents and living a frugal lifestyle. I save $2,000/mo. in a high yield interest savings account (Ally Bank). So after reading the forums and watching a bunch of BiggerPockets podcasts, I came to the conclusion that I want to do a traditional house hack with either a duplex, triplex, or quad. I’m getting married soon and will eventually have to move out of parents house. So the goal is to get my own place to stay and completely eliminate my housing expense. I want to House Hack in either the Dearborn or Dearborn Heights market. I know a lot of people are lucky to just get their mortgage, taxes, and insurance covered. But I’d like to positively cash flow and I’m in absolutely no rush to find it. I know you should never wait for that “Home Run” deal as it could lead to “analysis paralysis” and not get you to take action. But this is my first ever investment property, so I wanna make sure I crunch the numbers right, and get all my housing expenses covered. And maybe a few extra hundred bucks a month if I’m lucky. So by my estimates, I should have $30,000 in savings by December of 2020. This is when I plan to pull the trigger on my first deal. I just feel like I need a large amount of money to account for potential rehab, vacancy, repairs, potential closing costs, etc.. Just feel like it’s better to start out with a lot of money to make the boat sail smoother than starting out with barely enough.

Do you feel like $30K is enough to get started House Hacking a Duplex, Triplex, or Quad, in Dearborn or Dearborn Heights? Or would I need more cash? I know I have to cover a down payment and maybe a closing cost depending on the negotiations of a deal. But how much would I realistically pay for a rehab? I know it’s all relative to whatever work needs to be done. But according to your experience, for like a duplex, how much do you think I could spend for renovations without having to break the bank?

A lot of people are telling me to not limit myself to Dearborn or Dearborn Heights and to consider expanding my considerations for other markets. My only thing is I can’t see myself living in Detroit proper. Houses are a lot cheaper, but I don’t know if I feel too comfortable living there for obvious reasons, and I’ve heard countless stories of people who struggle to get tenants there to pay rent. It seems to attract the low-quality tenant, and I don’t wanna take that gamble. Dearborn and Dearborn Heights are my target markets and I’d like to House Hack there.

What are your guy's thoughts? I don't want to House Hack SFR or rent out bedrooms. I'm going to be getting married soon, so I'd prefer to have my own living space in my own unit. I know I'm sacrificing profitability for comfortability, but I'm okay with that. Because I plan on having a long-term relationship with real estate, and I don't mind climbing the financial-independent ladder a little bit slower if it means I could make my future wife happy and live a more comfortable fulfilling life.

If you’ve read up to this far, thanks for taking time out of your day to hear me out and to lemme tell my story.

Any and all answers pertaining to my situation would be greatly appreciated! Thanks again!