Househacking in a Hot Market

Househacking is by far the easiest, lowest cost and most powerful way to get started in real estate investing or grow your portfolio for next to nothing down. That being said the market is hot and it is becoming increasingly more difficult to find a good househack! Now the argument can be made that with low interest rates which lead to lower mortgage payments for more expensive properties and cost savings from househacking that anything is still worth househacking. Arguably you will always be in a better spot in the future if you househack, even if you can't go brag about how great of a deal you found on the BiggerPockets forums. No matter what you do it will be better than not househacking as long as you can live for cheaper than you would have otherwise. With househacking you get to save money, acquire a rental property, paydown a loan (forced savings!), property appreciation (hello inflation) and you actually save money on your taxes! 

All that said, there are effective ways to househack in any market. Of course, everyone wants to househack a multifamily property in a nice area that will cashflow well when they move out. Who wouldn't? You get to have your own nice space, where you want to be and don't have to sacrifice too much of your lifestyle.  If you can't find this make sure you consider all of the other benefits. If you can cover the mortgage and can hold onto the property it still may be worth it. If you're in a hotter market or a market with less multifamily property this may not be so much of an option or may be out of your price range.

Don't let this stop you!!!

There are many other ways to househack that may be easier to get into in your market or may even cashfow more/save you money while you live there.

Condos

A lot of real estate investors don't love condos. Lots of homebuyers want a single family home and scoff at the thought of living in a condo. Use this to your advantage when you are looking for a househack. For all of the reasons that people don't like condos there are just as many reasons to love them. I have a friend who is very wealthy off buying condos and loves that the HOA takes care of a lot of his management issues. Remember with a condo or townhome you are only responsible for the interior of the unit in almost every case. This means that you don't have to deal with any issues happening outside of the property like trash or crime and at the same time your only Capital Expense items are appliances, HVAC, water heater and things like flooring or light fixtures. As always make sure the numbers work. You'll need to do a bit more math here as the HOA fee matters a lot but also may cover hazard insurance, exterior maintenance and some or all of the utilities. 

Single Family

Single family is always great for househacking when you rent out rooms but I would also argue that you can "househack" a single family by living in it for a year and then rent it out after moving out. This will of course not save you money while living in it but will leave you with a cashflowing rental if you buy right all for 3-5% down or even less if you use down payment assistance programs that are available in every area. Jump on Google and search down payment assistance (your area). Also talk to a few lenders about this, some specialize in down payment assistance and can explain all of your options well. With single family there are also many other options including adding rooms to unused or underutilized space. Convert a garage into a suite, turn an office into the bedroom, pop up a wall or two and make that dining room a bedroom, the options are endless just be creative. Along with adding bedrooms in many areas you can also add an ADU (accessory dwelling unit). This can be as complex as having an ADU built from the ground up, retrofit a shipping container or get one of those sweet modular housing units or something like this Boxabl unit that is affordable and easy to install.

My point here is that while multifamily househacking is awesome it has gotten considerably harder to make them work in the lower price ranges, especially in hot areas. Consider all of the options, you can make this work in any market and live somewhere you don't hate for cheaper than a typical rent or mortgage!