Multi-Family House Hack Success

[Michael Doherty]

Just closed on my first MFH Duplex in New Britain, Ct. I am currently living in one half and renting out the other (house hacking). I was able to utilize an FHA loan, put 6,300 down and finance the rest.

I would first like to thank BP and everyone here for contributing and helping out. I can confidently say without the continuous content and support from the folks here at BP I wouldn't have had such a successful first purchase. After reading and listening to countless articles/forums and podcasts I was finally able to make that first plunge. The only way to get started is to challenge your self and be open to making mistakes, but more importantly learning from your mistakes. So with that said- the numbers:

Purchase Price: 180K

Appraised for 192k

Taxes: 3800 yearly

HO Insurance: 125 per month

PMI: 120 per month

Electricity: budgeted 50 per month (yet to receive electric bill)

Water/Sewer: 50 per month

Repairs: 5% of rental income

CapEx: 5% of rental income

Vacancy: 3%

No property management costs 

Cap rate: 9.79% which is decent for my area

Interest rate on loan 3.625% 30 year fixed

All in all my P&I, taxes and insurance runs about 1350 a month and I currently have the top unit rented for 1250 a month. Once I move out I will be able to rent my unit for 1000-1100 per month for a decent cash flow.

The house has already been redone- I purchased from a guy who flipped it. He bought it foreclosure from the bank for 47k and Invested about 75k into it, gutting the entire home. All new windows, electrical, plumbing, appliances, tile, paint, finished hardwoods and new roof provided by bank when it was foreclosed on. He stands to make a nice profit and I stand to have a turn key house that will cash flow- win win. 

I would recommend the BP calculator to anyone seriously looking purchase an investment property. It will save you time and money and help you determine which houses to walk away from. After going through the process I definitely have caught the "bug" and can't wait to get started on my next property. Currently deciding what to do next- flip, BRRR or another rental.

Thank you again for all the contributors on here and those who helped along the way. Please reach out with any questions or comments!