Hybrid House-Hack is Paving the Way to Financial Freedom

[Andrew Huffman]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $71,000
Cash invested: $8,000

My wife purchased this as her first home when she was 19. We got married at 23 and then spent 6 years living in it and renovating as we went. It was in poor shape when she picked it up. It then became our first house-hack after I discovered the BP forums and podcast when we were looking to buy our next home. It now rents for more than double the mortgage! Today's market is allowing us to HELOC and therefore become cash buyers from this point forward to do flip deals and future BRRRRs.

What made you interested in investing in this type of deal?

It was an accident at first, but thanks to BP we are capitalizing and not looking back!

How did you find this deal and how did you negotiate it?

It was off market in 2008 after sitting vacant for a year. My wife bought it as her first home using the Obama-era first time home buyer's credit.

How did you finance this deal?

Standard bank financing, then refinanced to lower the rate/payment several years ago.

How did you add value to the deal?

Rehabbed every room over time. We also tiled the whole house which has come in handy. Some renters can be dirty, but that tile is so easy to clean.

What was the outcome?

It has become our jumping off point for REI. Not only does it cashflow $600/mo, but it's equity position is so strong that we are able to HELOC on it and have enough buying power to pay cash for more homes just like it in the same neighborhood, which is well placed for strong cash flowing investments.

Lessons learned? Challenges?

There really isn't anything scary about doing RE. I've touched every "system" in the home now, mostly by myself, and am now confident that nothing is so challenging that the risk is no longer worth it. I want 20 more just like it.

Did you work with any real estate professionals (agents, lenders, etc.) that you'd recommend to others?

Myself! As a result of this drawn out journey, I got my RE license and now enjoy helping others that are looking to live differently. I feel like we lived out the blueprint for how to house-hack your way into real estate wealth, and using FHA products anyone can do this. Especially if you're young and don't mind moving every year or so, you could do this five times in five years and potentially never have to "work" again. Wish I would have known 10 years ago!