Originally posted by @Eric Riddle:
Hi BP community. I'm a rookie investor looking to do my first deal with house hacking. One of my biggest concerns moving forward is landlording. For anyone that has house hacked before, is there anything different about land lording a property you also live in? Are the interactions with tenants any different? Any guidance here would be nice. It's already a little intimidating starting out as a landlord, but to do it with no experience while living next to my tenant(s) sounds like it could potentially be harder to navigate, set boundaries, etc. Any suggestions would be greatly appreciated!
Eric,
I'm house hacking a duplex and have some advice:
• Pick a good property in a good neighborhood. The property and neighborhood will be 90% of what draws your tenants. If you're buying in a neighborhood that you're really happy to live in, you'll find likeminded tenants who are jazzed to rent there.
• Find your own tenant. I live in CA, where we have very strict fair housing laws (though most fair housing laws are federal, so you're subject them to). I knew I shouldn't ask questions about personal habits, etc., but when I showed my rental unit, I talked about my family's habits. I explained that I lived upstairs with my wife and daughter, that we were early-to-bed and early risers, that we weren't fond of hosting dinner parties, etc. Just telling this to prospective tenants weeded out a few people who probably did want to host parties, etc. And the tenants we ended up going with responded really well to my story (like, "Oh, great! I'm up at 5 to hit the gym every morning. I'm always asleep by 9, it's hilarious!")
• This duplex is actually my third home, and honestly, managing a duplex is about as difficult as managing a single-family home. There are more appliances, but that's about it. When friends ask me if I have to unclog toilets, I happily tell them that I've only had to unclog toilets wrecked by my wife, never a tenant.
• Setup online rent payment through apartments.com. This way, you never have to discuss rent payment with your tenants (unless it becomes an issue). Make sure your lease states when rent is due, when a late fee will be applied (if any), and when a notice to perform will be delivered. This way, everything is in writing. Then stick to it! You can be friends/friendly with your tenant while also adhering to the signed lease.
Really, it's all about the screening. Pick a good building in a good neighborhood, then spend time with your prospective tenants to select the best.
Good luck!
Jon
