Purpose-Built for House Hacking

[Jerad Graham]

If someone developed a new property specifically for someone to buy who would be house hacking, what are some of the main things you would want to see in the property? Duplex, Triplex, Quadplex? Room counts? Amenities? Obviously it's market-dependent, but I'm curious about this community's wishlist.

[Wale Lawal]

@Jerad Graham

House hacking properties should have features like a quadplex with 3-4 bedrooms, flexible layouts, private entrances, and amenities. Energy-efficient features, soundproofing, shared amenities, and local zoning compliance are crucial. Location is also important, as house hackers may seek properties near public transport, schools, and restaurants. FHA eligibility is also important for financing. The ultimate goal is to maximize income potential and tenant satisfaction.

Good luck!

[Jerad Graham]

Quote from @Wale Lawal:

@Jerad Graham

House hacking properties should have features like a quadplex with 3-4 bedrooms, flexible layouts, private entrances, and amenities. Energy-efficient features, soundproofing, shared amenities, and local zoning compliance are crucial. Location is also important, as house hackers may seek properties near public transport, schools, and restaurants. FHA eligibility is also important for financing. The ultimate goal is to maximize income potential and tenant satisfaction.

Good luck!

What amenities would you look for in a quadplex? I don't see many with any amenities at all and building them into a budget with only 4 units usually isn't feasible.

[Wale Lawal]

Quote from @Jerad Graham:

Quote from @Wale Lawal:

@Jerad Graham

House hacking properties should have features like a quadplex with 3-4 bedrooms, flexible layouts, private entrances, and amenities. Energy-efficient features, soundproofing, shared amenities, and local zoning compliance are crucial. Location is also important, as house hackers may seek properties near public transport, schools, and restaurants. FHA eligibility is also important for financing. The ultimate goal is to maximize income potential and tenant satisfaction.

Good luck!

What amenities would you look for in a quadplex? I don't see many with any amenities at all and building them into a budget with only 4 units usually isn't feasible.

 Modern finishes, Washer and dryer and refrigerator.

3bed/2bath minimum is preferred in the Texas Market.

If you can add 2 car garage, that will make it more desirable and attach more buyers.

All the best

[Masyn Grant Barney]

We have a builder here in Utah that is building single family homes with fully separated basement ADUs. They come with fantastic insulation between the floors, extra parking on the side with a separate entrance, their own laundry, and plenty of bedrooms up & down. My favorite has 5 bedrooms up and 2-3 down. So the basement ADU brings in plenty of revenue to make the upstairs owners mortgage liability equal to that of a small townhome.

I think this will become much more common in areas where people are being priced out of the market. Lenders can use legal ADUs to help qualify for the mortgage, so people that didn't even want to house hack before, may be in the market to do so simply to afford the type of house they want. 

[Rick Albert]

It's really about the lending. There are very special circumstances where a lender will count projected rents by the room. Otherwise, it is all about individual units.

Plus I would argue that the House Hacking Community is small. As a developer, you want to cast the widest net possible. Because it is a form of investing, it isn't like a HH will pay a huge premium because of it.

If you want to get creative, it might be interesting to see what is in your market and what tenants desire. For example, if you are in a heavy bike community, maybe installing bike racks somewhere might bring some character to the property and it doesn't cost a lot. If you are up in the mountains, somewhere to store snowboards. If you are in a college area, maybe having a study room/den could be interesting with the house pre wired for internet.

If you are really set on your buyer being a house hacker, another interesting option for house hacking is to have each room with their own locks, etc. That's what I did for my first house hack since I had roommates. The cost isn't much different and a buyer can go in and start renting out rooms immediately. 

[Jerad Graham]

Quote from @Masyn Grant Barney:

We have a builder here in Utah that is building single family homes with fully separated basement ADUs. They come with fantastic insulation between the floors, extra parking on the side with a separate entrance, their own laundry, and plenty of bedrooms up & down. My favorite has 5 bedrooms up and 2-3 down. So the basement ADU brings in plenty of revenue to make the upstairs owners mortgage liability equal to that of a small townhome.

I think this will become much more common in areas where people are being priced out of the market. Lenders can use legal ADUs to help qualify for the mortgage, so people that didn't even want to house hack before, may be in the market to do so simply to afford the type of house they want. 

 Thank you. This gave me some creative ideas about how to configure the units and make it more appealing to a wider market with some variability/flexibility for the owner. 

[Jerad Graham]

Quote from @Rick Albert:

It's really about the lending. There are very special circumstances where a lender will count projected rents by the room. Otherwise, it is all about individual units.

Plus I would argue that the House Hacking Community is small. As a developer, you want to cast the widest net possible. Because it is a form of investing, it isn't like a HH will pay a huge premium because of it.

If you want to get creative, it might be interesting to see what is in your market and what tenants desire. For example, if you are in a heavy bike community, maybe installing bike racks somewhere might bring some character to the property and it doesn't cost a lot. If you are up in the mountains, somewhere to store snowboards. If you are in a college area, maybe having a study room/den could be interesting with the house pre wired for internet.

If you are really set on your buyer being a house hacker, another interesting option for house hacking is to have each room with their own locks, etc. That's what I did for my first house hack since I had roommates. The cost isn't much different and a buyer can go in and start renting out rooms immediately. 

I have all separate units in mind, not shared houses. The buyers don't have to use it for HH, but there's a lending program available in the market I'm first considering it where HH would be more appealing than buying as a remote investor. The market-dependent specialty amenities that you bring up are a good idea that I will start working into the plan. Thank you!