Negative CoC ROI and Negative Cash Flow

[Account Closed]

Planning on living in a duplex where we would have a negative CoC ROI and a negative cash flow for the first year. Only planning on living there for one year because of the FHA rules. From there, I estimate we would be cash flowing $200-$300 monthly. Silly idea or is it wise to pull the trigger?

[Jonathon Hunt]

I look at it in two ways. 

1) Will house hacking with the duplex reduce your current monthly spend on rent? If yes, then I would go for it. If no, when you factor in principal reduction, are you doing better than monthy rent? If yes, I would consider it still if you are able to meet your other financial obligations.

2) Can you get a better return on your investment today for $200-$300 per month with the same amount of risk? Real estate is just one of many ways to diversify your funds.

Just some simple questions to get you thinking and moving in the right direction.