How to get started with house hacking.

Question

Hi, I'm new to the real estate investing world and I wanted to give it a test run with house hacking. So just want some advice or tips, just anything at all you can tell me from a personal standpoint about house hacking for me to get started in the future

Wale Lawal · Answer

@Nick BradshawCongratulations for choosing to start with house hacking as your entrance point into the world of real estate investing! As it enables you to live in one unit of a property while renting out others to pay your housing bills, house hacking is an excellent strategy—especially for first-time homebuyers. To help you get started with home hacking, consider the following advice:1. Establish Your Goals: Make sure your objectives for house hacking are clear. Establish your budget, the kind of property (duplex, triplex, or fourplex) that interests you, and the degree of property management participation you desire.2. Budgeting and Financing: Determine how much you can afford by taking stock of your financial situation. Investigate your choices for financing, such as FHA loans, which sometimes have lower down payments. Talk to mortgage lenders3. Examine Transactions: Gain expertise in evaluating real estate transactions. Be familiar with calculating ROI, prospective cash flow, and other important measures. Guidance can be obtained via tools such as the 1% rule.4. Form a team: Assemble a trustworthy group of experts, such as a mortgage broker, property inspector, real estate agent, and maybe even a property manager. Establishing connections with nearby experts is crucial.5. House Hacking Strategies: Examine various house hacking techniques, such as renting out individual rooms or residing in one flat and renting out the others. Select a plan of action based on your objectives and lifestyle.Remember, every real estate investment journey is unique. Start small, gain experience, and use each property as a learning opportunity. House hacking can be a powerful strategy to build wealth and financial independence. Good luck!

Ryan Thomson · Answer

@Nick Bradshaw I can't give advice for New York as I am located in Colorado Springs. BUTTT.... Here are some resources I found really helpful on my journey:1. For podcasts I really like the House Hacking episodes on Bigger Pockets Podcast and other channels. Here is a playlist with the best House Hacking Podcasts I’ve found: https://open.spotify.com/playlist/4A6uLsPfdWEMmJhG4TSjyb?si=...2. Great beginners guide: https://www.biggerpockets.com/blog/wp-content/uploads/2022/0...3. The Book on House Hacking Strategies by Bigger Pockets is also a fantastic book4. Happy to talk if you want more advice5. Connect with a realtor who understands house hacking and has invested themselves 6. Connect with a lender to see what you qualify for and how you can improve that situation7. Go to local Real Estate meetups and learn from people there

Lucas Thomas · Answer

Hello Fellow House Hacker!I've House Hacked as both a Live-In Landlord (Boarding house law) and as an owner occupied in a 4 unit apartment building, etc..Here is some quick and dirty tricks and tips!:Rule one: get used to the properties not being in the greatest of areas (some exceptions in some states). Multifamily units in many states were built in areas that aren't the best. They also Zoned Away many multifamily units that are 2-4 units starting in the 1980s on average. So many multifamily places available for your house hacking are going to be older and may be less nice than your accustomed. If you house hack as a Live-In landlord however, then you can live in any house, anywhere as long as it has a lot of bedrooms. Rule Two: for tenant purposes, you are not the landlord. No matter what. You are not the landlord. Do not talk to your tenants or give them any inkling your the landlord. This includes using a google voice # for tenant calls and texts, having a real estate agent show and rent the place for you, and having a PO Box where bills, legal paperwork, and payments are sent. This matters when you start evicting your neighbors and having tenant disputes. Rule Three: Landlording Sucks. Accept this and you will do great! As you will deal with every horrible thing in life.... tenants disputes, sleazy contractors, the city who hates your grass, everyone has a sob story and can't pay rent, be emotional ready for evictions and threats, and know your lease and local laws. Rule #4: Don't rent to friends, family, coworkers, or anyone you associate with outside of landlording. Rule #5: Turn your rentals into bunkers as tenants are tenants and they will destroy your property through "Wear and Tear". This is the fundamentals. If you want to know more. DM me. I used to be a property manager!L.Thomas

Carlos Scarpero · Answer

Not done it personally but I've helped investors do it.Keep in mind that most programs will require you to have cash reserves to do it. Many of my potential borrowers have trouble meeting this requirement,

Mose Gebremeskel · Answer

Great tips!

Lucas Thomas · Answer

Of course! Anytime!I've done and dealt with almost everything that can go wrong in the Landlord world.It's not a pretty business.

Benjamin Sulka · Answer

Lucas,Love those tips. Would love to hop on a call with you sometime to chat! I'm looking to buy my first multifamily this year and have come to many of the realizations that you pointed out. Glad to be aware of these to set expectations when I get started. Going to send you a DM!

Wale Lawal · Answer

Most welcome!Keep learning and growing.

Nick Bradshaw · Answer

Thank you for all this information I'm soaking in all in!!

Nick Bradshaw · Answer

Thank you for the information and yes, I plan to rent out to some of my friends and my main goal is cash flow and to use that excess cash to invest in more properties!!