Owner Occupied MFH Math

1 Reply

Looking for a bit of advice on the math I'm doing on a MFH I'm looking at buying for my first property. 

Its a converted house with 4 units that is fully rented. Doing the math, it would cashflow wonderfully on its own as an investment, between $200-$300 a door/mo after 50% rule and mortgage, with some updating and raising rents closer to market rate as a result.

The catch here is that I would like to owner occupy my first purchase, partially for ease of managing the property, partially for some lifestyle flexibility (namely pets) that come with owning your residence as opposed to renting.

Do folks looking to owner occupy their rentals work out the math on a property including they rental they plan to occupy as part of the cashflow/door calculations or is it more common to try to make the numbers work under the assumption its a 3 unit property? I will continue to work full time for the foreseeable future, so in theory, I can understand either set of assumptions, as my own "rent" can go straight to savings for a 2nd property, but I'm curious to hear what other people think. 

I would do both. That's what I did when I bought my multi-family. I looked at it in Year 1 (where I would be living there) and then in Years 2 - 29. Obviously rent from unit 1 didn't cover all of my expenses, so I knew that I would be paying into the property for the first year. However, I wouldn't be paying a lot so I was pretty comfortable with that and pulled the trigger.

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