House Hacking Deal Sheet
Check this out... I'm a realtor and this was deal analysis for someone looking to House Hack and move out after one year in.
Rents for the deal are $1650 / side, one side already is leased out.
Purchase Price: $385,000
Downpayment FHA 3.5%: $13,475
Closing Costs: ~$7,500
Cash to Get In (Cash Outlay): $20,975
Living expenses year 1: $1,227 / month
*Move out year 2*
Rent Cash Flows from Year 2: $5,364
Equity Built through Mortgage Payoff through Year 2: ~$11,000
Projected 10% appreciation over 2 year: ~$38,500
Total Return on Investment through 2 years: $54,864
Return on Investment Two Years in: 261% ROI
Quote from @Tyler Lingle:Two questions:
Check this out... I'm a realtor and this was deal analysis for someone looking to House Hack and move out after one year in.
Rents for the deal are $1650 / side, one side already is leased out.
Purchase Price: $385,000
Downpayment FHA 3.5%: $13,475
Closing Costs: ~$7,500
Cash to Get In (Cash Outlay): $20,975
Living expenses year 1: $1,227 / month*Move out year 2*
Rent Cash Flows from Year 2: $5,364
Equity Built through Mortgage Payoff through Year 2: ~$11,000
Projected 10% appreciation over 2 year: ~$38,500
Total Return on Investment through 2 years: $54,864
Return on Investment Two Years in: 261% ROI
What are the living expenses year 1: 1,227/ month?
How did you calculate the cash flow from year 2 at 5,364?
I want to piggyback with @Brandon Plombon. Could you elaborate if this is a duplex, triplex, fourplex @Tyler Lingle.
I'm Guessing the 5,364 cashflow is the ANNUEL NET cashflow.
my question is did you calculate in current interest rates? 6% have been crushing our local cash flows but we make up for it in the boise market because our appreciation is ~$10k/mo
I love that this factors in all the different facets of house hacking! Things really start to look nice once you move out and keep it as a full time rental. The numbers only get better year after year
A few additional things that should be considered:
- Mortgage insurance premium added to the loan on an FHA (upfront and monthly)
- Cost to resell the property in year 2 (roughly 8.5%)