If your single family was rented, would it have a positive cash flow?
It all depends on the numbers, if it is all the same to you as far as your living situation then yes assuming your house rents for more than one side of the duplex.
Our home in our area would give us a positive cash flow of $100-$300
Would it be better for tax purposes if I moved into the duplex?
If your single family would cashflow more than the duplex then yeah move into the duplex. Tax wise, you will be able to write more off regardless since you will have more properties. You'd be able to write off depreciation etc on both properties if you moved. As of now your home isn't an 'income producing property' therefore you don't write off things like maintenance and such.
However, if you moved, you could write off both!
I say go for it @Michael Williams
Thanks for the great advice @Jacob Price a
I believe for the duplex you would only be able to write off expenses for the unit you are not living in, but I'd double check with a tax professional to be sure.
Thank you @AaronKlatt
Sacramento is a great market to do this in. I have had many clients there do this and they were certainly glad they did.
One thing nobody mentioned is that by making the duplex your primary residence, you're going to get owner-occupied financing instead of having to get a loan for an investment property. Lower interest rate, lower down payment, bigger savings.
Coupled with the cashflow from your single family home, you'll be well on your way to saving up for the next property and repeating the process all over again. That's how wealth is created.
What area of Sacramento are you looking in?
Originally posted by @Michael Williams :
My wife and I would like to purchase a Duplex in our area in Sacramento, we are currently living in our single family home that we are still paying our mortgage on. Is it more advantageous to move into the duplex and rent the other unit and move tenants into our single family home or continue to live in our home and rent both sides of the duplex?
If you have the chance to house hack, this is the way to go, cannot beat living for free, stack the cash and buy RE in the rust belt and get your cash flow rolling in.