Success With Luxury House Hacking

[Casey Murray]

Hi BP, has anyone had success in luxury house hacking in the San Diego area, specifically coastal north county (Del Mar-Carlsbad)? It's best to invest where numbers make sense but live where you want. Luxury house hacking combines the two and seems interesting especially with the progression of ADU laws in certain San Diego cities (and not in certain cities). Thanks in advance!

[Shawn Couch]

I live in Encinitas and sometimes AirBNB (STR) the extra room, or our house when we go on vacation. People do rent both. Renting just the extra room covers our housing cost, but you have to deal with having people in your space, which can actually be nice, or also a pain. I have found that most people that share the space only use the house/room for sleeping. You can also easily rent a room for $900++ on a monthly basis. Closer to beach and having a private bath boost those rents. A 2 bedroom place around here rents for $3000. In Encinitas, the City will give you approved plans for a detached ADU, you can get a studio, up to 3 bedrooms and pay no permits either. You just have to get the site layout approved, etc. They are doing this to boost "low income housing". You can also have an additional attached ADU, but need to comply with size rules (up to 25% of main house) and are supposed to get permits and approvals. So if you bought a large enough house with a layout that you could chop off a couple of rooms to make an ADU or 2, you could potentially have up to $6000 a month without the headaches of the STR. Prices are high, but this is a great area so rents are high too.