House Hacking in San Diego

16 Replies

Hey guys,

Has anyone house hacked in San Diego (preferably in neighborhoods as north as Encinitas to as south as downtown)? I'm looking to hear about your experiences! 

I'm just getting started myself, learning the number game and reading up as much as I can about real estate. I'm a mechanical engineer full-time and enjoy my job but realize that real estate is a solid investment vehicle if done properly... 

Would love to hear from working professionals who pulled off a house-hack in their spare time - what did you learn? what would you do differently? who helped you the most?

Thanks!

Hey Trevor - I did some version of it with my condo in Encinitas by renting out the other room for a few years.  I was able to get solid demand for $1000-$1100 for a private room and bathroom. I'm about 2 miles from the beach for reference.  Nothing like the returns a multi-family will get you but the price point/availability for those is quite steep unless you want to look inland.

Kind of depends on your situation - your personal finances, your tolerability for multiple roommates, condition of the home, time frame, etc...

I'm also a mech engineer working in SD - PM me and we can chat in more detail

I started out house hacking long ago (before I ever heard of the term) in Claremont by renting. An extra bedroom.   My “tenants” helped me make my mortgage payment.  

This type of house hacking is best done when you are young.  It provides a advantage that can be leveraged for future success.  

With that future success, other options will present themselves.   

Originally posted by @Dan Heuschele :

I started out house hacking long ago (before I ever heard of the term) in Claremont by renting. An extra bedroom.   My “tenants” helped me make my mortgage payment.  

This type of house hacking is best done when you are young.  It provides a advantage that can be leveraged for future success.  

With that future success, other options will present themselves.   

Dan, that's great to hear and I'm glad you pulled that off around our area. Did you feel you needed an agent to get started? Also, did you target places ready to live-in since you were just getting started or weren't afraid of doing a couple repairs?

Hope your current investments are still going strong.

-Trev

Originally posted by @Ryan Weimer :

Hey Trevor - I did some version of it with my condo in Encinitas by renting out the other room for a few years.  I was able to get solid demand for $1000-$1100 for a private room and bathroom. I'm about 2 miles from the beach for reference.  Nothing like the returns a multi-family will get you but the price point/availability for those is quite steep unless you want to look inland.

Kind of depends on your situation - your personal finances, your tolerability for multiple roommates, condition of the home, time frame, etc...

I'm also a mech engineer working in SD - PM me and we can chat in more detail

 Congrats, Ryan. I love the Encinitas area and really see it being a great place to live in as I spend more time in SD (I'm originally from NJ, moved about ~2yrs ago). I will definitely be reaching out shortly.

-Trev

Originally posted by @Trevor J. :
Originally posted by @Dan Heuschele:

I started out house hacking long ago (before I ever heard of the term) in Claremont by renting. An extra bedroom.   My “tenants” helped me make my mortgage payment.  

This type of house hacking is best done when you are young.  It provides a advantage that can be leveraged for future success.  

With that future success, other options will present themselves.   

Dan, that's great to hear and I'm glad you pulled that off around our area. Did you feel you needed an agent to get started? Also, did you target places ready to live-in since you were just getting started or weren't afraid of doing a couple repairs?

Hope your current investments are still going strong.

-Trev

 It was easy.  No different than a roommate situation in college.   The house was not pristine or anything.  I rehabbed it as time permitted, but when I move out making it a rental everything had been redone except the big items (foundation, roof, heater, plumbing (except we did the sewer), and electrical).  

I know a lot more now and would have done things a little different.   There was no BP site with a wealth of information but I knew more than most people.

We have done pretty good with our RE investments.  That house has appreciated almost $0.5M.  Imagine how well I could have done if I knew what I know today.  

Good luck

Hey guys! I'm seeing great opportunities with ADUs now in older areas. Like the college area: Look for small houses around $400-450k on a long lot, and the neighboring houses are larger and around 6. Enclose the garage or add space, and then add an ADU in the far back (granny flat). These become like a multi-unit cash-cow. Other areas are also older like Esco, San Carlos, Rolando and old Chula.

Hi @Trevor J. ! I saw your post here and I'm trying to do something similar in SD. I am looking to utilize the FHA 203K program if possible to roll rehab costs into the loan! I also happen to be a mechanical engineer like you and @Ryan Weimer , funny how we gravitate towards real estate! Would love to connect with you both and bounce some ideas back and forth!

@Meredith Stowers Thanks for the tip! By college area would that happen to also include UCSD? Off the top of my head I can't think of seeing anything like this around there but maybe I missed some neighborhoods. I only ask because that campus is right next to my work and would be ideal for my house-hacking needs. I'll do some driving around regardless to see. Definitely will be checking out the areas you mentioned!

-Trev 

@Trevor J. count me in on that discussion! Yes, it could include UCSD but that area is so expensive. It could also include the JCs and Miramar College and Cal State San Marcos in your area. But the older areas are definitely much better opportunities. The granny flats really increase the value, even if it's only enclosing the garage. Encinitas has great regs on that.

Hi @Trevor J. ! Love that you're getting involved in the investment game like this with a house hack! Congrats man. I have been able to help a lot of clients in SoCal with helping them find homes with detached garages and building out ADUs. The detached garage is perfect for that type of house hack and it's a fairly cheap way to add another unit to your existing home. I'm helping one of my clients do this right now in Redlands. He's purchasing a home that needs some work, but is set up perfectly to house hack. My client is going to fix up the house, build out the garage and convert it into an ADU and live in it, while he rents out the front house. The front house rent will pay for his entire mortgage and then some ($2,200/month in rent)! Then, once he decides he doesn't want to live in the converted garage anymore, he can rent that out without an issue for $1,000 to $1,200/month. THAT IS INSANE CASHFLOW!! Imagine having 5 houses with the ADU in the back doing this same thing!

Let's chat and see how we can strategise on achieving your dream of creating generational wealth through the acquisition of real estate! 

@Trevor J. I did this from 2011 to 2016. Bought a sfh 3/2 in clairemont that needed some work. Fixed it up and rented out 1-2 rooms and never had a problem finding good room mates. I then did a cash out refinance bought a 2br2ba condo near SDSU in 2015 and been positive cash flowing both since. I definitely recommend it! A few of my friends and coworkers did something similar.

Little late to this thread but I'm in San Diego and have done this type of thing a few times.  We've had great luck with using Airbnb in these house hack situations...definitely a bit more work but you can much higher rental income than with a regular rental.  We had a live-in Airbnb situation with 3 rooms listed and were taking in about $10k a month while paying $6k a month for the space...basically living for free AND cash flowing $4k/mo.  Presently have nearly our entire mortgage covered with a detached guest house listed on Airbnb in the El Cajon/La Mesa area.  I'd estimate we take in about 50%-100% more revenue with Airbnb than a regular listing.  It's definitely more work but you can outsource the cleaning and the management side is fairly minimal work especially if you can set it up for self check-in and whatnot.  @Meredith Stowers is spot-on with the ADU tip...huge opportunities there. Happy to join in any direct discussions if I can be of help!