The Next Move - Attempting to Start

[Zane Ritter]

Hello all. About 1.5 years ago, I purchased (conventional loan) and have been living in a 3x3.5 townhouse with a family member (brother) in a first attempt to start building equity through a house hack/BRRR strategy. The initial plan was to slowly rent out the spare rooms and renovate until a refinance/moving out and onto the next property made financial sense. Unfortunately, I have quickly realized the mortgage is much too steep a payment to promote a net positive cashflow even with all rooms rented. I am hoping for some direction. My gut response is for us to sell at 2 year mark and collect the equity (tax free). However, the home is in an A-class area that is rapidly growing and could prove profitable once the property could be refinanced at a lower rate.

[Jonathan Greene]

You picked the wrong kind of property to start in as a 3/3.1 townhouse is not ideal for room hacking and is more residential in nature which is why you should sell it and take the proceeds and deposit money and look for a two-family where you and your brother can live in one side and you can full rent the other side - maybe even as a mid-term rental to 2x the rent.