Married... with Roommates? Househack Hustle as a First Deal

[Andrew Lekowski]

Investment Info:

Single-family residence buy & hold investment in Enterprise.

Purchase price: $1
Cash invested: $1

House Hack, renting out 2/3 of the bedrooms to live for free. Purchased with the VA Loan, using 0% down (we actually got an escrow check at closing, so we got paid to buy this!)

Cashflow pays for Mortgage (Principal and Interest), Taxes, Insurance, AND all Utilities. Strategy is to use this property as three separate units in the future, renting out each bedroom just like we are doing now.

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

Through BiggerPockets, I was first introduced to the idea of the househack. As an active duty military member, I knew I could do this strategy with the 0% down VA loan. The original plan was to buy a small multifamily (2-4 units) and rent out the other units. Upon graduation from West Point and a 10 day house hunting adventure, there were no small multi families on the market! My wife (fiancee at the time) decided that we were still going to househack using a single family home.

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

As first time home buyers, it only made sense to use a real estate agent. On military leave, we took advantage of TLE (basically free house hunting money from the Army) to pay for our trip, hotel, and food moving from Illinois to Alabama. We found it after looking at 20+ homes for sale. We negotiated it through our agent, and ended up getting it with several thousand off listing, negotiated repairs, and an early occupancy agreement.

How did you finance this deal?

VA loan, 0% down. Used Veterans United.

How did you add value to the deal?

Mainly a turn key property. There was some wood rot up front which we had the seller replace and waterproof with siding of our own choice. The backyard we did landscaping and added a shed. Throughout the house and garage we added a ton of shelving.
The biggest value add we did was using this property as a house hack. Because this single family 3bd/2bth has two stories to it, we rent out the entire upstairs to other Army flight school students. Through this strategy, we maximize our return.

What was the outcome?

Living completely for free!

Lessons learned? Challenges?

The big piece that makes this house hack unique is doing it while married. Married with roommates is not for everyone nor every property. Finding the property and spouse that supports this strategy was a tough process, and I definitely made the right decision (on both) ;)

In the end, it all comes down to opportunity cost. Does the cost of having roommates while married outweigh the financial benefits of living for free? In our case, it was a yes, and we would definitely recommend it.