Hello all, I am a 20yr old college student about to transfer to UMich for aerospace engineering. I have wanted to get into investing since I was 16, I have about 35k saved rn but I'm not sure which market to target or when. I will be graduating university with a 70k loan, and my question is should I pay this off first, realistically within a year of graduation, or try to get into my first house hack rn? I have friends with W2 I can likely use as a partner for their income. I will be paying rent anyway when I go to university so I thought now would be a great time to start. If I started now, I would be targeting a house / duplex in Ann Arbor to rent the rooms out, or if I waited to pay off my loan first then I'd be investing in the Chicagoland area. I currently do tenant turnover inspections as i wanted to start learning about the business, I still got free time on my hands so I was also thinking of getting licensed in order to earn some extra cash while simultaneously building my network / knowledge.
With that mindset at 20, you're already ahead of most. The Ann Arbor house hack is a genuinely smart move. University towns have built-in demand too, which helps with vacancy.
On loan vs. invest — it comes down to your interest rate. Low rate? Your capital likely works harder in real estate. High rate? Pay it down first. Run the numbers on both.
If you have free time then getting licensed is not a bad idea, but you can also read some books or do free online courses on RE investing. Ultimately, nothing will teach you more than your own lived experience. You can also start with rent arbitrage, it's not as capital intensive as acquiring a property and you get the landlord experience.
The W2 partner idea is solid, just make sure you're aligned on exit strategy and expectations before mixing business with friendship.
Rental Property Investor · Member since 2026 · 56 posts · 29 votes
4mo
Hey Luke, paying off a 70k loan within 1 year of graduation when you have 35k saved for an investment doesn't seem realistic.. unless you've got a fantastic job lined up or other savings? I'd say the financially responsible move is to pay off the debt first while learning the business. I don't think missing 1 year of cashflow/appreciation will matter too much in the long run. But if you're wanting to take the risk and jump in now, I think house hacking is relatively low risk for you with a high salary if you plan on living there for a while
Accountant · Chicago, IL · Member since 2018 · 2k+ posts · 1k+ votes
4mo
Luke - you're off to a great start. Realistically, you may need a co-signer to secure a loan but if the math works in Ann Arbor and you have renters, why not? I would ask yourself if you'd like to keep the property in Ann arbor long term. Given the university of Michigan, I'd think yes.
Chicago is also a fantastic market for house hacking too. I'd recommend listening to the straight up Chicago investor podcast and attending local events if you happen to be in town. Happy to be a resource should you need anyone in Chicagoland!
Investor · Hatboro, PA · Member since 2016 · 3k+ posts · 866 votes
4mo
With $35K saved and real estate experience, you're in a strong position. I'd focus on making sure a house hack truly cash flows before jumping in. Look at purchase price, rents by room, vacancy rates, maintenance, and whether you'd still be comfortable owning it after graduation. Also compare the expected return from that investment to the interest rate on your student loans. The answer may become much clearer once you run both scenarios side by side.
Contractor · Chicago, IL · Member since 2016 · 4k+ posts · 2k+ votes
4mo
What's up @Luke Okane - Hope life has been treating you well! It's been a minute since we last connected!
I am not sure I have a specific vote either way. I think you need to consider what your interest rate will be on your college loan before jumping to pay it off too quickly.
Regarding the house hack in Ann Arbor, that's a big commitment that obviously comes with additional stress. I totally think you can handle it, but part of me says don't sweat the housing, enjoy college, and save your money so when you are done you can buy a real property.
The other part of me says 100% get a house hack in college it will be a great experience, should be easy to rent out the rooms, and gives you first hand landlord experience.
Either way, you're a smart guy, so do what feels light, right, and best for you! There is no right answer...
When you come back to Chicago, we can always partner up again!
Hello all, I am a 20yr old college student about to transfer to UMich for aerospace engineering. I have wanted to get into investing since I was 16, I have about 35k saved rn but I'm not sure which market to target or when. I will be graduating university with a 70k loan, and my question is should I pay this off first, realistically within a year of graduation, or try to get into my first house hack rn? I have friends with W2 I can likely use as a partner for their income. I will be paying rent anyway when I go to university so I thought now would be a great time to start. If I started now, I would be targeting a house / duplex in Ann Arbor to rent the rooms out, or if I waited to pay off my loan first then I'd be investing in the Chicagoland area. I currently do tenant turnover inspections as i wanted to start learning about the business, I still got free time on my hands so I was also thinking of getting licensed in order to earn some extra cash while simultaneously building my network / knowledge.
Modify below as needed for your situation and consider having your parents cosign on an FHA mortgage - you won't need any income or good credit, program allows 100% use of cosigner's.
If I was starting out again with what I know now, I'd look to acquire a 2-4 unit property with an FHA 3.5% low-down payment mortgage.
I'd also look into using an FHA 203k renovation loan, allowing me to buy something ugly, thus unqualified for a standard mortgage, which would weed out a lot of competition and push the price lower.
To maximize my cashflow and gain landlording experience, I'd do STR and MTR in the other units, as well as the other bedrooms in my unit.
Since most cities won’t allow basement rental units, I’d consider finishing the basement, just well enough for me to live down there (cities don’t care if owner chooses to live in basement), so I could rent out ALL the units/rooms.
I'd save all my cash and look to refi the property in 1-2 years out of the FHA mortgage, so I could use it again if necessary. Depending on how close I was to having 20% equity in the property and being able to avoid PMI, I'd consider using some of my cash to pay down the mortgage when I refinanced. Otherwise, I'd save my cash for the next acquisition.
I’d also be posting on every social media platform and telling everyone I knew that I was looking for more real estate deals. I’d aim for low downpayment land contracts and lease options.
After refinancing out of the FHA mortgage, I'd evaluate if I wanted to repeat the 2-4 unit FHA 203(k) process again or if I had the 20% down to target 5+ units.
While still living in the property, AFTER the refi out of the FHA mortgage, I'd also explore securing a HELOC to tap my equity for emergencies.
Wholesaler · Charleston WV · Member since 2026 · 246 posts · 135 votes
4mo
At 20 with $35k saved, you're already ahead of where most people start. If you can make a house hack work in Ann Arbor while you're attending school, I'd seriously explore it. You'll be paying for housing anyway, so having roommates help cover the mortgage can teach you investing, landlording, and property management while building equity. Just be careful not to stretch yourself so thin that it hurts your engineering degree.
The biggest lesson is that there will never be a perfect time. Whether you buy now or wait until after paying off your student loans, make sure you're building skills and relationships in the meantime. Your tenant inspection experience is already giving you a practical education. I'd continue networking, learning how to analyze deals, and studying local markets. A paid-off loan is great, but experience compounds too. The key is making a decision that keeps your risk manageable while moving you forward rather than waiting for certainty.
Hello all, I am a 20yr old college student about to transfer to UMich for aerospace engineering. I have wanted to get into investing since I was 16, I have about 35k saved rn but I'm not sure which market to target or when. I will be graduating university with a 70k loan, and my question is should I pay this off first, realistically within a year of graduation, or try to get into my first house hack rn? I have friends with W2 I can likely use as a partner for their income. I will be paying rent anyway when I go to university so I thought now would be a great time to start. If I started now, I would be targeting a house / duplex in Ann Arbor to rent the rooms out, or if I waited to pay off my loan first then I'd be investing in the Chicagoland area. I currently do tenant turnover inspections as i wanted to start learning about the business, I still got free time on my hands so I was also thinking of getting licensed in order to earn some extra cash while simultaneously building my network / knowledge.
Hey Luke, you have some good advice above. I just want to say, now that I’m in my 40s, when I think about investing, I wish I had started earlier. In my opinion, the earlier you house hack, the better. It’s much cheaper to get in and you’ll essentially gain insight on investing, landholding, etc right away. I started house hacking in my 30s and acquired a half a dozen properties that way. But I wish I started in my 20s. And I’m sure those in their 20s, wish they could’ve started at your age.
Hello all, I am a 20yr old college student about to transfer to UMich for aerospace engineering. I have wanted to get into investing since I was 16, I have about 35k saved rn but I'm not sure which market to target or when. I will be graduating university with a 70k loan, and my question is should I pay this off first, realistically within a year of graduation, or try to get into my first house hack rn? I have friends with W2 I can likely use as a partner for their income. I will be paying rent anyway when I go to university so I thought now would be a great time to start. If I started now, I would be targeting a house / duplex in Ann Arbor to rent the rooms out, or if I waited to pay off my loan first then I'd be investing in the Chicagoland area. I currently do tenant turnover inspections as i wanted to start learning about the business, I still got free time on my hands so I was also thinking of getting licensed in order to earn some extra cash while simultaneously building my network / knowledge.
We have sent 5 kids through college and consider investing in purchasing homes around the school until after they graduated. We should have done it while they were at the schools. I think your idea of establishing a relationship with some of your W2 partners to acquire a home near your school is a fantastic idea. What I recommend is you run the numbers to see how much your positive cash flow could potentially be from renting out rooms in a multifamily or home in Ann Arbor. I imagine you can get between $700 to $1100 per month per room. So betweeen $2800 to $4400 per month for a 4 bedroom home. Now imagine acquiring one home per year while in school. Since you'll be going to engineering school numbers will come easy so run the numbers & see what a typical Proforma would like like if you acquired a home, the rented it out. Then compare the results of that Proforma against paying off your loan. Let the numbers guide the decision on what to do. You'll also need to know the numbers before approaching any of your W2 friends to invest in your plan.
Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
4mo
My recommendation, as I have children your age, would be to:
1. Pay off your loans
2. Be debt-free
3. Save as much money as possible
4. Potentially house hack your first deal
That way, you get to understand the true cost of owning a home and understand all the things that can go wrong with it while you're living in it and owning it.
