When most of house hacking, they think buying a property with an ADU to airbnb/ rent out or buying a duplex, living in one end and renting out the other. We rarely hear about "rent by the room" which I think is one of the most recession proof forms of HH'ing out there.

I want to highlight Ryan Lind's first house hack that is crushing it! Ryan purchased a 4 bed/ 3 bath SFH in Arvada, CO back in November of 2020. What I really like about Ryan's story is that, even though he ran into some challenges right out of the gate, having the right mindset goes a long way when going through your first investment property.

Investment Info:

4 bed/ 3 bath SFH in Arvada, CO

Purchase Price:

$475,000

Cash Invested:

$17,000 + $2,500 in furnishings

$19,500 TOTAL

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

Ryan wanted to live for free by buying a 4+ bed home and renting out 3 of the rooms while living there. After moving out, rent out the 4th room and have a cash flowing rental on a low down payment/low interest loan. This property was also recently renovated so required low to no upfront repair costs.

How did you find the deal and did you or the agent need to do any negotiating?

The deal was right off the MLS. Using an investor friendly lender, he was able to offer a 14 day close. With the combination of the "quick close" and the listing being on the market for 30+ days, Lauren was able to get Ryan under contract $15,000 under asking and $5,000 seller credits.

Did you work with any real estate professionals?

Lauren Valinoti with Envision Advisors

How did you finance the deal?

Financed the deal with a conventional 30 year fixed mortgage with 3% down, 2.75% interest.

What was the outcome?

Beside some speed bumps early on, Ryan found massive success with this rental. By using shorter lease terms 6 months, he was able to capture market rental rate increases and raise rents 30% just in the first year while seeing 20% appreciation!

While living there, the mortgage (PITI) is +/- $100/month including reserves for maintenance (5%), vacancy (5%), and utilities. See spreadsheet images below

By decreasing his living expenses while house hacking, he is actively looking for HH#2

Lessons learned? Challenges?

What I really like about Ryan’s story is how he handled the speed bumps early on in this investment.

After closing, Ryan started listing his rooms for rent as quickly as possible on FB Marketplace, Craigslist, etc. but his listing kept getting taken down immediately after posting. After digging into it more, turns out there was a scammer using his photos/address to set up fake listings. After a few phone calls and proof he was the true owner of the property, he was able to get listings posted and rooms filled

Shortly after filling his basement room with a quality tenant, there was a serious flood coming from the basement bathroom. As mentioned above, the home Ryan purchased was a flip. As we all know, some contractors are better than others. This particular contractor cut a few corners and did not install the plumbing correctly which caused the flood. Being the top notch landlord that he is, offered the tenant some discounted rent so they would not vacate.

Ryan sees everything he went through as a learning experience that he can use for his next property. Because the entire bathroom had to be redone, he now has contacts with a variety of contractors he can use later. His insurance covered most of the repairs, so it wasn’t a problem giving the roommate a break on rent. When he looks at the spreadsheet and sees the returns he’ll be getting from this house, he knows he made the right decision.

Ryan is currently working with Lauren looking for HH#2. We are excited to hear his future success story.

Excellent work Ryan!