1st Time Investor - House Hack Multi-Family Unit - Worth it to buy ASAP?

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Hi Jacob!I don’t know the Chicago market so I can’t speak to that aspect of it. But, I do want to write to encourage you as house hacking a duplex is exactly how I got started. I bought mine for $230k. Just like this property, mine needed a very light remodel: new carpets, paint, a few minor other fixes. At the time I bought it, both units were renting for $750/mo which was under market for the area where it is located. I asked the seller to deliver the property vacant because I wanted to do the renovation right away which would not be possible with tenants in place, pick my own tenants, and charge market rent. The seller agreed and it worked out very well. I ended up moving into one of the units after the remodel (I did the painting myself and paid Lowe’s to install the new carpets) and rented out the other unit for about $1000/mo. I am very glad I pulled the trigger as this first house hack allowed me to begin to feel comfortable owning and managing rental properties. I continued investing in more multifamily properties, eventually partnering up with another investor and buying using the BRRRR strategy. I left my corporate job 9 years after I started with this one house hack and today I own 160 units. I credit it all to pulling the trigger on that first deal, punching fear in the face and doing something most people never have the courage to do.Some questions you should consider and know the answers to before deciding whether this deal will make a good house hack for you are (1) is it in a safe neighborhood? (2) how is the school district where it’s located is rated? (3) will the space and features it offers make it comfortable for you to live there for at least one year? (4) what are market rents for each apartment after renovations? (5) will the property cash flow or at least break even after you eventually move out of the unit you will be occupying?Hope this helps! Feel free to message me directly if you want to discuss any aspects of house hacking or the BRRRR strategy I used to scale. Vitaliy

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@Jacob Lopez I own in Bellwood, and I also am there a lot as my basketball group is there. It is a solid suburb for sure, but you also want to understand what repairs are needed. Bellwood does a very rigorous point of sale inspection that involves the building inspector, the plumbing inspector and an exterior inspector. They bring up a lot of items that sometimes make it tough to make sense of a deal, but honestly a lot of the stuff should be done anyways!The rental market has been solid for us. We have not had issues getting tenants in the area.

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You are very welcome @Jacob Lopez!My advice may be a bit contrarian but I don't think you should wait any longer than you have to...it won't hurt, but nobody is ever mad that they bought earlier than they were ready. They are mad that they wait until they are ready.Real estate until stocks is quite a bit more forgiving and flexible. Plus now is a great time to buy in Chicago...interest rates have dropped a bit and the swarm of buyers hasn't come back yet.

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Hello Jonathan!I'm grateful to also have such an array of experienced RE investors, agents and even contractors chime in on my little post.I am incredibly eager to pull the trigger and purchase my first property, but from the responses of the amazing members here - I think that I still need a little time to educate myself on what exactly I should expect and or want out of my first property. There is nothing that a little more time and a little more money saved up couldn't help, right? Thank you!

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Hello Paul,Thanks for the insightful response on my post. I understand that not all of the numbers are there for an actual thorough analysis of this property - but overall the property seems to have most checkboxes ticked off for me in terms of my first-time purchase. Despite this realization, I will make sure going forward to give more thought on all of the questions you have listed above to ensure that this is right for me.

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Hey there @Jacob Lopez - Generally speaking, I think every real estate deal is a great deal, IF the numbers make sense for your situation. Naturally, ALL real estate like the stock market goes up over TIME but different from stocks you don't only make money from appreciation but also cash flow, debt paydown, and tax benefits! I think like @Paul De Luca pointed out...it's hard for us to speak to your specific deals if we don't know all of your numbers, your criteria, and your exact situation. My opinion would be to go for it! Because the key to getting ahead is getting started and there is nothing that will replace experience. Just make sure you have the right Chicago team around.

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Hey Jacob,I am so glad to hear that you are looking to invest in real estate. House hacking is certainly the best way to get started with this. When looking at this deal, here are my initial thoughts and questions. When considering a house hack deal, you need good estimates and knowledge of what your are looking for your monthly payment to be, what that payment will be before deductions (gross rents), what your monthly deductions will be, and what your net rents will be. Unfortunately, in the year 2024, the once common 'live for free' model does not really exist. This is why its important to manage expectations and really know what your end goal is.in the right area, appreciation can offset a monthly loss and some with enough time. This brings up again the factor of rehab, and elongated rehab over many years. If you put enough work into a property and have spent 5-10 years there to gain some appreciation, you may be in a position where you could refinance and gain equity on your refinance. You can then keep this property with the equity you have now gained, or could sell the property with the gained equity, and buy something with the gained income. There are many strategies that can all be effective. Make sure your goals are clear and concise and you have a plan in place! Please let me know if you'd like to further discuss.

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This could be a great renovation project through a Homestyle or 203k loan where you can roll the financing into the purchase.

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Piggy backing off John, be mindful that Bellwood requires inspections by the village! Good luck!

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Hello Diya!The points you have brought up are some of the reasons why I know that househacking would be an ideal start in my real estate investing journey. The trickiest part at the moment is finding an ideal spot (looking more at the Chicago suburbs) which itself will come with its own pros and cons: higher taxes, higher property prices, etc.Thank you for taking some time to give me advice on my post! Best wishes!