[Calc Review] Help me analyze this deal

[Joshua Herald]

I am looking at a multi family in cincinnati and I am debating "house hacking" one of the units  while we renovate it to get better financing or just running it as a rental. Obviously by losing a full units rent, the numbers are now low but are still in the positive. How do you calculate the value of not having a mortgage? 

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*This link comes directly from our calculators, based on information input by the member who posted.

[Andrew Terrell]

@Joshua Herald

Is the attached analysis only considering rent from one unit, or from both? I am assuming you ran this analysis with $2100 being the gross rent from both units. 

I am currently house-hacking a duplex, and looking to house-hack another small 2-4 unit MF. When I run my numbers on prospect deals, I run them as if I were purchasing it as a pure rental/investment property. As long as it makes sense as an investment property, meaning, I am hitting my personal cash-flow and ROI goals while covering all the expenses you have accounted for in your analysis, then it is a WIN, and I move forward with the deal. When I was looking for my first house-hack I had a big spreadsheet where I ran numbers for each property as a stand-alone investment property, me living in one unit, and then living in a unit and renting out a room or two if that was possible. Now, I just run the numbers as if it is an investment property for simplicity. I know that I will only occupy a unit for a limited time, and the house-hack is just a way to get more favorable rates, better loan terms, and elminate, or severely decrease my housing costs today.

I am sure there is someone on BP who has built some wild spreadsheet, or other model where you can actually calculate the value of no mortgage, but for me, as long as I am covering most, or all of my PITI while I am occupying a unit, and the deal works as a stand-alone investment deal, then I am done running numbers.

Hopefully that helps, and if not, maybe some other BP members can fill-in where I fell short.

Good luck!

Andrew Terrell