All Forum Posts by: Bradley Dosch

House hacked with a 3% down payment. Saved money from my job. Focus on increasing income and decreasing income and investing this difference.

Hey Simon, great question. It definitely isn't considered commercials and others have said already. There are some regulations and stipulations around FHA loans for 3-4 units (self sufficiency) but this doesn't increase the down payment and make it a commercial loan. Make sure you find a good lender in your area who understands house hacking and exactly what you're trying to do. There are plenty of lenders on this site and at local meetups. No need to force the issue with banks who are ignorant to house hacking. Good luck Simon!

Hey Danielle, no I've never bought any property in CA - just grew up there. Sorry for the confusion

Sounds like a neat journey, congrats!

Hey Danielle, it's super exciting that you're looking to get started house hacking! I grew up in OC and it can certainly seem daunting. I think your outlook is solid. Generally, it's better to buy a SFH or MFH over a condo/townhome. However, this means you need a higher pre approval and that's not always attainable. Rather than waiting, your viewpoint on getting started with a condo/townhome/something more affordable is sound reasoning. Waiting is expensive! As others have stated, make sure you watch out for HOA rules against house hacking or renting in general. This is the biggest gotcha in this category. Sounds like you have a good head on your shoulders, good luck out there Danielle!

Hey Zane, thanks for the post! Love the desire to create relationships. A bit about myself: I have house hacked three times in a row (once a year for three years). It's a super accessible way for people to get started in REI. I highly recommend this strategy to most everyone getting started. Feel free anytime to reach out! Fresno seems like a neat place to house hack :)

Hey Breland, congrats on your first house hack! Sounds like an awesome plan. I've had good luck with finding a local insurance broker that can shop multiple policies for you. Make sure you tell them your plan of renting out extra rooms so they can include this in their search.

Hey DeVon, thanks for posting this! A few things:

There's no need to set up a legal entity for house hacking. You'll just buy it and have the loan in your personal name. 

Continue saving up capital for a house hack. Increase the difference between income and expenses best you can. Remember you need 3-5% down and hopefully an agent that can negotiate the seller pays closing costs. 

Consider focusing your search more on single family house hacks. You'll likely see way more inventory here and, with some creativity, some better cash flow numbers. 

You're welcome to reach out to me with any more questions. I would recommend finding a good agent in your area and they will effectively become your mentor. Good luck DeVon!

Hey Vaishaag, good question and a common problem. In expensive markets, with these prices, high interest rates, and low down payments it can be very difficult to break even. Here are a few things that have helped my clients and me:

Consider buying a single family house that you can be creative with rather than a new townhome. It'll be tough to make a new townhome work, especially with a HOA.

Of the 3 options you've presented, I like option 2 the best. Is there a basement you can add a second kitchen to? Many MLS filters have search options for an existing second kitchen. Is there enough space and does the local zoning allow for a DADU play? Get a good agent who can negotiate price down in the market. How else can you be creative to generate more income from the property?

While it may seem like the 5% down payment is your enemy, it is truly the catalyst for house hacking. This allows real estate investing to become way more accessible for people. Remember to keep a long term vision with investing. 

I don't know the Durham area but this is what works in my and many other markets. Good luck Vaishaag!

Hey Dennis, nice job saving up that much capital. That certainly helps. You have some options. House hacking is almost always the best way for most people to get started. I don't know your exact situation. You can buy a house hack to live in which is pretty easy and also powerful. At this point, you'll probably still have enough left over to buy another investment property, invest the money in other asset classes, do some renovations on the place, and/or have healthy reserves. My advice is to keep it simple, don't over complicate things - use a proven strategy like house hacking. Gain experience, equity and cash flow then keep repeating. Good luck Dennis!