Hey house hacking peeps,
I wanted to share some of the biggest lessons I've learned so far with my wife and I's duplex house hack.
1) Finding the right property is VERY important for a house hack. In our situation, there were other multi family properties available, but they were either much further from the city, in bad neighborhoods, or very old outdated properties.
IMO location is everything in a house hack. First, you will be living there, so I think it should be a place that you want to live. Second, with a better location it has been much easier to rent and we receive higher rents. Lastly, great locations open your property up to many other opportunities (STR, "MTR", etc.)
2) For your first house hack and for future investments, having a knowledgeable investor friendly team members can make a huge difference. A real estate agent with knowledge of investments, analyzing deals, knowing construction, and having crucial contacts will drastically improve your odds of success. They can connect you with other rockstar team members like lenders, inspectors, contractors, insurance, attorneys, etc.
Where to find these agents?? Here! Or at a local real estate meet-up is another great option.
3) IMO (duplex, triplex, quadplex) are best, butttt in some areas supply is limited. In these markets, you may need to get creative! I think there are many over looked opportunities like mother in law suites, finished basements with walk out, finished garage, or building an ADU, renting to room mates to offset cost, etc. It is still possible without small multi-family.
4) Renovations. If you do them, then make sure you are hiring a vetted professional. Get multiple referrals, quotes, and references. This can help you make the most informed decision. Your rockstar agent will likely be able to steer you in the right direction, but you can always find outside sources too.
There will be unexpected costs that come up, so make sure you give a little cushion in your budgeting for that.
5) Screening- Have a thorough and standardized screening process. It will make your decisions a lot easier and hopefully it will prevent you from having "bad" tenants. Also, this process will allow you to be fair in your selection process.
Ex. Credit score 650 >
Income 3x rent
No prior felonies or evictions
xx
xx
6) Property Management - You can hire a professional and pay an additional 8-15% of your income or self manage. IMO self managing is VERY doable for a house hack or for any of your first handful of properties. The property management software makes it extremely easy and efficient.
AVAIL, STESSA, RENT REDI, BASELANE, TENANT CLOUD, etc. are solid options. Choose one, try it out, and see if it has all the features you want. If it doesn't, move on from the free trial and try the next one.
7) STR/MTR can be a game changer. A little more set-up initially and things to learn, but once you're off and running, then your property can significantly generate more income. I would highly recommend to consider it and include it in your deal analysis for potential properties.
I'm sure I'm missing something, but these were some of my "off the cuff" thoughts on important things I've learned. Does anyone else have any important points that I missed?
