House Hacking in Orange County, CA

[Hannah Noble]

Hi my name is Hannah and I am new to real estate, currently have a 9-5 job, but am looking to start my journey to financial freedom. I have been doing a lot of research and education on real estate investing.  I thought starting out with a house hack would be the best way to start and get my feet (I read Craig Curelop's House Hacking book). However, I live in a very pricey market (Orange County, CA) and am not sure if this strategy would work as well here. Has anyone had success in this area with house hacking, either a single family or multi-family? If so any tips or ideas on how to begin this process in Orange County?

Thank you!

[Joe Homs]

@Hannah Noble welcome to BiggerPockets here in Orange County, CA.  I believe you can house hack here, but it all depends on the following:

Price, Price, Price...

OK let make some assumptions here.  A 3 Bedroom, 2 Bath Condo under $370K.  You want a 3 bedroom to rent out two of them and at the very least your own private bath and the guest bath for your other two roommates.  Remember you must also qualify for the entire loan on your own.

$370K       Purchase Price

$37K         Down Payment

$333K       Loan @ 3.25% interest    $1450 a month

Taxes                                              $400 a month

HOA Dues $400 a month

Total plus or minus payment           $2250 a month

Minus renting two rooms                 $1600 a month

Your costs would be only                   $650 a month

You can use these numbers for any property in Orange County or California for that matter.

The next thing you must consider is location, location, location...

This is what may drive up the price of the homes you are looking at and why it may not work for you here.

Good Investing...