Best Next Move? House Hack a 4-Unit, Buy an Airbnb, or Another Strategy?

Question

I currently own a single-family rental purchased in 2021 for $236,000. I still owe about $160,000 at a 3.6% interest rate, fixed for one more year before it adjusts to a variable rate. The property was recently appraised at $374,000, giving me strong equity.

I also have a $50,000 line of credit secured against the property that has not been used yet.

Recently, my bank approved me for an FHA loan with 3.5% down, which opens the door for buying a multi-unit property.

I’m now trying to figure out the smartest next move:

• House hack a 4-unit using the FHA loan?

• Buy an Airbnb / short-term rental?

• Stick to long-term rentals and scale steadily?

• Or is there another strategy that makes more sense given my situation?

My goal is to build a small, cash-flowing portfolio while keeping risk manageable. I’d appreciate any advice from investors who’ve gone down these paths—especially those who have used FHA loans for multi-units or compared house hacking vs. Airbnb investing.

Denise Supplee · Answer

Hi @Elmer Wayne Fisher, based on my experience and your goal here, with an FHA 3.5%, I would lean toward house hacking on a 3–4 unit. It would boost your income, help your lending profile for the next deal, and would keep things far more predictable than Airbnb.

Airbnb can work, but it adds layers of regulation, seasonality, and management headaches that many investors often underestimate.

Whatever you choose, just make sure it supports the bigger plan🙂

Elmer Wayne Fisher · Answer

Would it better to get a fixer upper or buy something that is ready to move into?

Also location probably doesn’t matter as much for something like this? I’m also currently renting a property with a roommate at $680 per month so not bad

Elmer Wayne Fisher · Answer

I was leaning towards house hack. Sorry for not clarifying but the property I own now is being rented long term as we speak. I’m collecting 1945.00 per month while having a property manager take care of the property at 8% so technically I would be a first time home buyer correct? The property pretty much breaks even per year. I’m trying to find something that cash flows a decent amount.

Long term goals are to be more investor focused and spreading out the real estate so to speak.

Elmer Wayne Fisher · Answer

Thanks for your input!

Aaron Zimmerman · Answer

House hack is the way to go for sure. You need to live somewhere and you'll ideally reduce your housing expense. I would house hack as long as you can. You can also combine other strategies to maximize cash flow (MTR, STR, and rent by the room).

What do you plan to do with your current house? Given you've lived there two of the last five years, you could sell the place. Or you could keep it as a long term rental, mid term rental, STR, or rent by the room. Given the low interest rate, it would probably produce some cash flow.

Best Next Move? House Hack a 4-Unit, Buy an Airbnb, or Another Strategy?

5 Replies