Would you house hack this? - Help me analyze this deal

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Four unit Property:

1 - Single family 2bed1bath with large basement + large 2 car garage

3 - 1 bed 1bath units

Hi everyone! This is a very unique 4 unit property.  It consists of a 2 bedroom single family home with a huge detached garage along with 3 units which are all 1bed 1bath.  I know my numbers are not perfect and might be missing a few.  But overall you get the picture.  I am thinking about buying this property and living in the house.  I know some of you might ask why I am putting 20% down and not doing an FHA loan 3-5% down.  I don't qualify for the loan and I am having my business buy the property.  I placed $750 a month rent for the house which is what it will rent for once I move out.  While I live there, I will rent from my LLC for probably $500 a month.  This is a long term hold and I only plan to house hack it for a year or so.

What are you thoughts? I know it's not a steal of a deal, but it's actually a property I enjoy living in.  Multi family is very hard to find in my area that isn't in the ghetto.  What are your thoughts?!

Account Closed · Answer

@Kyle Grimm, Congratulations !

1. I didn't see the built year but $100 cap-ex and repairs seems little low for 4 units  ( Remember that there will be 4 furnace, water-heater, ACs toilets, kitchens, and so on) .

2. Don't  you need lawn-care? And pest (termite) control if you are planning to hold this for a long term?

3. Closing cost is definitely low. Ask you mortgage broker to send you a preliminary closing sheet. It should be around $4000- $5000 in my opinion. Talk to the seller so you can finance the closing cost: increase the offer price and the seller will pay the closing cost.

I hate that you have to put down that much but I think it is still a decent deal if the rent will go up at the national avg rate and such properties are hard to come by.

Good luck.

Jaysen Medhurst · Answer

@Kyle Grimm as it stands, I agree with @Dennis M. Why not do a 30-year loan? That will increase your cash flow by ~$200/month.

Also, talk to your accountant about renting from your own LLC. That sounds like self-dealing, not sure if it's kosher, especially since you'll be holding the mortgage personally.

Dennis M. · Answer

Eh..Marginal deal . You should be looking for 150-200$ a door cashflow