House Hacking in San Francisco Bay Area

7 Replies

Hi All,

New to real estate investing, but love the idea of house hacking. An FHA loan limit for a 4 unit in that area is 1.2 million. I wanted to ask people from the bay area if it was still possible to house hack seeing as the prices are so high right now.

It's possible. Not sure that you would cash flow from what I have heard in California but definitely possible. 

Hi @Alex Chau ,

The largest challenge you will face is getting your 3.5% FHA offer accepted when competing offers will be 25%+ down conventional for an open market MLS property. I've seen folks have success by basically acting like wholesalers -- get the property before it hits MLS. Drive/walk/call for dollars, call MFR landlords listing units for rent and offer to take the entire property off of their hands, that sort of thing.

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Hey Alex,

It's definitely possible to house hack.  It just depends on what your expectations are.

Realistically could you expect to house hack and have your mortgage payments be lower than renting?  Quite possible.

Could you expect to live rent free while the other 3 units pay for your mortgage?  Maybe, but it would require a lot more searching, work, and probably some compromises, etc.

In other words, yes, but you should run the numbers to understand your expected payment in the end.  My take: It's likely you're still paying out, but you can consider that equity into your place.

@David Kyo , my expectations is that I will have to still put in some of my own money for the mortgage, but much lower (was thinking renting 3 units for 2-2.5k each) at around $1k. I guess my question is if it was still possible to find a 4 unit in that price range. Sorry for the confusion.

Hey @Alex Chau

Gotcha, I'd listen to Chris about the FHA loan stuff. From what I've seen FHA loans are always going to have a harder time against conventional loans. Also the price range of 1.2M is not going to get you much in terms of a 4-plex in your current vicinity. A quick scan of MLS listings should tell you the story of what market prices are like. I'm a n00b trying to figure out how to approach the area as well so I have by no means "figured it out."