Turn Key House Hacking in Utah

3 Replies

Hello smart people on Bigger Pockets!  My wife and I live in a town home and have about $80,000 of equity.  We're interested in selling and purchasing a 3 or 4 plex and live in one of the units for at least a year.  We'd plan on moving to a different property after the year is up.  As I'm crunching the numbers, it appears that while we're living in the property we'd need to pay about what we are paying for our mortgage now, and once we move we'd basically just be breaking even (all things considered- taxes, vacancy, etc.).  I'm not a handy-man and am not interested in fixing something up.  We've looked at newer properties that wouldn't require much of any repairs.  To me it seems like a pretty good deal, eventually the cash flow will be there.  However, I've heard other stories of people being able to house hack and the numbers seem to work out that while living in the property their payments are extremely low.  Any thoughts or direction anybody would give me?

@Trevor Sharp yes, make sure that you can make the whole payment when there are no tenants occupying the other units. It is super important that if you were to leave the unit that it will cash flow enough to survive a market correction. Once you get to a higher level you will be worrying more about net worth then you will worry for cash flow, but cash flow is what allows your asset to survive a market crash for 5 to 15 years before it starts to build wealth and equity again. if I were you, I would learn everything that there is to know about house hacking like reading Craig Curelops book the house hacking strategy. read other peoples books on house hacking and learn everything there is to know about that strategy.

Another thing you might look into is renting a bigger unit and house hacking that so that you don’t have any of your own money into the deal and can leave whenever you want when your lease is up instead of risking your equity when a correction hits. This is called rent hacking and you can find out more about it on YouTube with Airbnb or long-term leases.

Having said that, if you do decide to buy a four Plex and 1031 exchange into that, make sure that your ROI is better in the 4 Plex deal than it would be in your current place right now if you were to rent it out and therefore not pay closing costs and fees on the sale of your home.