Low-Key-Duplex House Hack in SoCal

[James Chavez]

Investment Info:

Single-family residence buy & hold investment.

Purchase price: $710,000
Cash invested: $100,000

Our first purchase is a single family home that was 3-1 with an attached studio that was converted from an indoor patio in a B neighborhood. Now it is a 2-1+2-1 and we are living in the back "unit" and renting the front for $2300. Our mortgage is $3800, so our portion is only $1500! if we were to rent out the back for $2500, we would be cash-flowing $1200 :)

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

The benefits of house hacking: Better 5% down conventional loan; and having a place of our own to live in, finally.

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

An agent from Zillow and we spoke directly to the real-estate agents to find out their needs. Turns out they needed the rent-back option and that was our winning chip in beating an FHA loan that was $20k over our offer.

How did you finance this deal?

5% down conventional loan

How did you add value to the deal?

The Rent-Back agreement with the previous owner to give them time to find a place. Win-Win for all!

What was the outcome?

We allowed them to pay our P.I.T.I. for two months while they found a place to move to.

Lessons learned? Challenges?

Heavily vet new contractors and give yourself time to think. Don't sign just because they are pushy.