House hacking with friends, yes or no?

Question

Good morning BP forums,

I have the plans of purchasing my first home this fall/winter and I want to house hack it. I plan on renting out the bedrooms and I will live in the office, loft, basement (or whatever it may be). I am aware that renting out a home to family or friends is not a good idea when it comes to the traditional rental, but does it make a difference if you will be living in it? I would love to here an experiences that you may have with this. Have great day!

James Wise · Answer

Longer i've been in business the more I believe it's best to keep personal life and business as separate as possible.

Aaron K. · Answer

No it doesn't because the same problems exist, you have to be prepared to evict/ lose a friend or family member if they are a bad tenant.

Frank Wong · Answer

I don't see any issue if they are going to be roommates. Just make it clear up front if they stop paying for whatever reason you need to find a new tenant that will pay. This will make you the bad guy. Its a lose lose situation for you but if you understand that you can lose a friend bc of this then go for it.

As for your title of house hacking and actually partnering up? Never.  I would never partner with family and friends it never works out.  Someone won't pull their weight and that is where the drama will begin.

Dane Larsen · Answer

Thank you all for taking the time to post on my discussion. All of your viewpoints have further confirmed my previous beliefs. I will plan on keeping my business and personal life separate straight from the get-go. Thanks again!

Bjorik Mutize · Answer

Yea it's iffy. Plus its a judge of character and knowing how financially stable they are. I'd personally rent to the only friends i talk to, that's my situation and comfort though.

It's much easier not to, and if they ask why not...point out all of the cons we mentioned above.

Brent Paul · Answer

It's never easy when family or friends are involved.  Personally I never mix friends with business.

You need to make it clear that if they don't pay they are out and make them sign some type of agreement.  The problem with friends or family is they may try to take advantage of the situation.   I have an uncle that owns many rental properties.  The most problem tenants has been friends or family.  The last one caused over 10k in damages.  Every window was broken, ever door was destroyed, holes in every wall, sinks ripped from the wall.  An absolute nightmare.  And yes these were close friends of the family.  Proceed with extreme caution.

House hacking with friends, yes or no?

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