How do I calculate my cash flow when house hacking?

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Question. I am looking a a duplex for my first investment. I am thinking about house hacking, but how do I analyze the deal? Do i just analyze it with one tenant rent or do I add my rent for the second unit if the equation? Please help. Thanks :)

Hi Vanessa!

I'm house hacking a duplex now. Here's what I would do.

1. Analyze it as if both units were rented. This is the long-term analysis, and it's really important that you know this will work ahead of time. If it won't work after you move out, then you don't want it.

2. Analyze it as if one unit is rented, and the other is not. This gets a bit messy because a lot of expenses are shared between the 2 units (cutting the grass, replacing the roof) but you can get a good idea of whether your tenants will be paying for your mortgage or not. And that's really good to know.

Good luck!