Questions about house hacking in SF/East Bay

16 Replies | San Francisco, California


This is my first time posting here— I found BP via an episode on the ChooseFI podcast. From my brief perusal this evening it seems like I've come to the right place to ask a few questions regarding so-called "house hacking" in San Francisco and the East Bay, specifically Berkeley/NOBE.

My partner and I are looking to get a bit more space— we currently live in a studio in the city— as we're anticipating expanding our family in the next couple of years. It would also be nice to have a room for guests to stay in.

We're attracted to the idea of house hacking as a way to offset monthly expenses and reduce the risk of such a large purchase. We've both rented our entire adult lives and, while we're comfortable with investing in paper assets, we have zero experience with real estate. That said, we're both motivated and my partner particularly has a knack for interior design, so we're not averse to a property improvement play.

Is house hacking a realistic option for us? We'd be comfortable with either a long-term or a vacation rental situation, assuming the numbers and the property are right for us.

As first-time home buyers, is an FHA loan possible? I'm only beginning to get familiar with the various limits, though at first glance it looks like we would qualify.

Use an FHA Loan to househack a duplex. Find a vacant duplex so you can live in one side and AirBnb the other unit. Make sure that you don't allow any guests to book a stay of no more than 29 days.....especially in Richmond, SF, Oakland or Berkeley. Tenants rights and all the nonsense that comes along with it.

Thanks, @Brian Garlington ! Appreciate you sharing your insight.

In your experience have you found a sweet spot for number of bedrooms and AirBnb occupancy rates? I imagine it's easier to book more nights per month in a studio or a 1 bedroom versus a 2+ bedroom, though a 2+ bedroom will yield more per night.

Also, any thoughts on the viability of a short-term rental in SF versus Berkeley or Oakland? I'm expecting a steep drop-off in income potential of a centrally-located SF neighborhood versus the East Bay, or even a spot in the Sunset or Richmond.

No offense my friend, but your first step needs to be getting pre-approved with a lender before doing analysis paralysis.  There's a Bay Area Lender on here named Chris mason who can help you out. Otherwise, this is just an exercise sir.

Sup Ryan,

 "House Hacking", clever term?

Formula : Total Annual Income        (-)      (Annual Expenses).  = CashFlow 

Total Annual Expenses EXP.(OperatingExpenses+Maintenance+MortgagePayment+Insurance+PropertyTax+etc.)  

*ALSO Don't forget Special Assessment Tax 1st year.

Are you in the positive or in the (negative)? In the Green or in the (Red)?

if you're ok with the outcome? That deal makes sense for you , or is it called " house hacking" ? :)

BTW: Not Every city is AirBnb Friendly, check your local zoning laws. Also, will your mortgage lender allow it?

Good Luck.

@Ryan Oblak  - Welcome to BP.  This is a great community full of knowledge and awesome people.  Have you looked into House Hacking any more?  We (The @David Greene Team) have a lender we can refer you to as well.  We have helped a lot of clients in your shoes find a property to House Hack in the East Bay.  There are opportunities out there!  Feel free to reach out to see how we can help you meet your goals.  

Oakland landlords lose courtroom battle, after paying $6,500 to move back into their house

Judge dismisses lawsuit challenging Oakland’s relocation payment ordinance

See article in East Bay Times.  Not only a problem in Oakland, but State now supports this as well.  These two women rented out their home while they did a stint in Washington, DC for the Air Force.  At the time they rented out their home, there was no such ordinance in Oakland.  "In Oakland, landlords must pay tenants $7,116.22 for a studio or one-bedroom unit, $8,758.43 for a two-bedroom unit and $10,811.20 for a unit with three or more bedrooms. But since the Ballingers’ tenants lived in the house for less than two years, their relocation payment was smaller. The city adjusts the payments for inflation every year. Tenants who are elderly, disabled and low-income, as well as those with minor children, are entitled to larger payments. The ordinance covers renter-occupied single-family homes, condos and multi-family apartment buildings built before 1996."

Hi @Blake Edwards I'm just starting to search for house hack opportunities in the east bay. I took some time away from RE to get my finances aligned, I'm just about ready to get back in and hit it hard.  I'll be either buying or renting in the near future and it's looking like i'll have to get real creative if I want to find a house hack deal. Any suggestions? I have been looking near walnut creek or pleasant hill. Not intimidated by rehab work and open to ideas.

Thank you,

@brian garlington thanks for asking, we have not found a place yet. It has been been competitive, we would have a better shot if we were buying cash. Stepping back for a bit, looking like we will be renting in the walnut creek area and shopping for long term rentals in Milwaukee. 

@Ryan Oblak   David Greene is a real estate agent in the bay area. You can hire the man himself to help you find a place to house hack. 

I don't know about SF specifically, but the way to do it in the peninsula or east bay is either buy a place with lots of bedrooms and rent out the extra rooms individually, or buy a place and then create a second unit - either convert the garage or build an ADU in the back yard, or both.

People use FHA loans to househack all the time. I don't know why you wouldn't be able to do it.

Originally posted by @Daniel Monk :

@brian garlington thanks for asking, we have not found a place yet. It has been been competitive, we would have a better shot if we were buying cash. Stepping back for a bit, looking like we will be renting in the walnut creek area and shopping for long term rentals in Milwaukee. 

Cash offers are sometimes a little overrated. At the same price a Seller may the choose a cash offer over a financed one, but I say may because even then other factors play a role as well - don't under estimate the emotional side. Many sellers want their home that they cared for so many years in the hands of someone who will move in and personally take care of it and not a faceless cash investor. There are many ways to play this. One of my favorite secret weapon is to call the listing agent - no joke, most agents will not call me before sending me an offer. Favorite question to ask: other than price, what else is important to your seller? They want their tenant friend to stay an extra 3 months, got burnt by an inspection before, need a flexible closing date to find a new place - accomodating these things are often worth more than money! To most sellers a cash offer is not worth a lot of money, meaning, at 3 to 5k less, they will probbaly choose a financed offer, as long as it is not FHA or VA. 5% down conventional is fine. Yes, Milwaukee is competitive, but we with a little experience you can win 3 out of 4 or better!

We’re currently House Hacking in Santa Clara, Redwood City and San Jose we can show you if you want to see



@Tom Tam    How are you house hacking in 3 different cities at the same time? I can see flipping and building and having rentals in all 3 cities at the same time, but househacking in 3 different residences at the same time puts a new definition to the term "I Get's Around" :-)