House Hack in Bay Area/San Jose?

[Justin Madison]

Should I house-hack or continue to rent?  I always heard of the house-hacking idea and never thought it possible for someone like me, since I live in the very expensive San Jose, CA and always thought the numbers would never get to positive cash-flow since real estate prices are so high here.  But, I gladly stand corrected.  Thanks to @ScottTrench and his book Set For Life, where he clearly and concisely outlines the numerous benefits to house-hacking and created a spreadsheet to analyze Renting vs. Buying a SFR vs. House-Hacking. I have used the spreadsheet he created to analyze a potential 4-plex purchase for $1,100,000, and found that with a 20% downpayment of $220,000, and a conservative estimate of collecting $6,050 per month in rent ($2,016 x 3 units, while living in the 4th), one could not only live for free, but have a positive cash flow of $8,382 per year while living for free. Not too shabby. I'm considering this strategy, and I'm interested in your thoughts. Just so you know our rent situation, we rent a 2 bed/1 bath condo for $1,650 per month. We have very kind, generous, God-fearing landlords that like us since we take good care of their place and pay rent on time. The condo is enough room for us for the next few years since my wife is just pregnant with our first child.

I will post the spreadsheets with the numbers below.

[Logan Allec]

Hi @Justin Madison.  House hack if you can.  It's a great strategy.  My first investment was a 4-unit house hack here in the LA area.

Of course this was a few years ago and prices are not as high down here as they are up there.

I will say though that I had to definitely look off the beaten bath for a deal.  For example, 4-unit properties in the city of LA itself were selling like hotcakes...all cash offers well above asking, etc.

I'd imagine it's similar if not worse in the Bay Area.

So I had to look kind of in the outskirts of LA to find a property without competition from the deep pockets.

Anyway feel free to reach out with any questions.  Good luck and grace to you.