@Zach Bagby I think your question is more about thought process than digging into the nitty-gritty of your numbers. Yes, as pointed out above, some of your assumptions are likely not entirely correct on the true costs, but your methodology of analysis looks pretty solid.
The choice of analysis metrics really comes down to personal preference in my mind. A lot of people like COC or ROI, and I believe those are valid methods of analysis mainly prior to the purchase. After time has passed, I think it is much more difficult to see analysis that makes sense using COC or ROI. My personal preference is to look at investments as best I can over a long period of time, so my preferred metric is Return on Equity (ROE).
House hacking, more than maybe any other style of REI, reveals the power of leverage. There are few other investment opportunities where you can put $17,500 at risk and control a $350,000 asset. As a result, a lot of your return metrics will look inflated in early time because of the minimal up-front investment. If you look at it over time from an ROE perspective, you will see a rapid decline in the ROE in the first few years as your reinvested equity outruns your investment gain.
Using ROE gives you a true sense of the opportunity cost of your investment because you're accounting for the "dead equity" left trapped in the investment. As a result, I think it's wise to set a baseline minimum expectation, and when your ROE dips below that level, it triggers a choice to access that equity and re-invest by selling, cash-out refinance, HELOC, etc. To give you a comparison, if you're a stock investor, you have a daily choice to either buy or sell your stock. There is no hold because making the decision to hold means that you would buy that stock at that price on that day. In a similar sense, we don't look at REI on a daily level but maybe yearly. After you've owned an asset for one year, you ideally have a certain amount of the equity in that property that you could access, and you make one of two choices - remove the available equity to invest in a higher return opportunity or "reinvest" that equity by keeping it locked in the property. This choice continues as time goes by and you reinvest more of the equity back into the property as the value appreciates and you pay down your loan.
Using this methodology allows you to make the most accurate comparison between investment alternatives as you move through time and gives you the information you need to deploy your funds at your optimum risk vs return level.
Hope that makes sense and I'm answering some of the questions you have.
