Updated about 4 years ago on . Most recent reply
First House Hack - Need Advice
This is our first house hack! We are looking to purchase a house with a basement hoping to have a seperate entry or a room that can be a seperate entry. We currently have a house we rent and rent a very small room that has a seperate entry and split profits. We see how succesful it has been so we are ready to own our home and do the same thing. We just can't do what I see many people do and rent rooms in the house due to have a child and 2 dogs. I just don't feel comfortable sharing space unless when we gave a child. I am feeling so LOST on where to look. How do I know if I see what I think is a good house the location would work? Most of the house we are finding for what we can afford is inEasy Aurora or not the best areas of Aurora, westminster or Thorton. I am not sure how to know we will get STR in these areas. I would love to find something in west Denver but there isn't much. We can't fix up much the house but if we have to invest money to create a seperate entry we can do that. I have been so used to living in either downtown Denver or Park hill neighborhood. Would these suburban neighboorhoods like Centenial, Aurora or Thorton be good options? Is there a way to estimate how much I can earn in rental?
The other issue is our rental is supposed to be renewed in a month and a half and the market is so low we feel stick because if we can't find a house by the time the lease runs out we will have to resign but if we do that then we would have to wait another year or there are hige fees to break the lease.
Thanks for all advice!
I really want to make this Happen!
Most Popular Reply
@Patty Nisbet you can buy a duplex if it is still your primary residence. When you get to triplex and quad, purchasing as a primary residence can be very challenging b/c in order to qualify for the loan, you will need to prove the home will pass the the self sufficiency test. Meaning, 75% of the total market rent for all the units has to be more than the total monthly mortgage payment (PITI). Simply put, if you expect to bring in $4000. Your mortgage payment can not exceed $3000/month. However, I have found duplex's do not make the best HH's because they are very expensive, competivie to get into, and typically need a lot of work to get things up and running. From a pier numbers prospective, single family homes will give you far better return on your investment
I know the feeling trying to house hack with a family. It can be super overwhelming. I have a daughter of my own so it definitely throws the rent by the room strategy out the door. Where I have found a majority of the homes that fit the criteria you are look for has been in the West/ North West side of Denver Metro Area (Lakewood, Wheat Ridge, Arvada, Westminster). Plus those areas have pretty friendly non-owner-occupied STR laws.
Finding a home that will make a good STR? My personal opinion, with good pictures, nice furnishings, competitive pricing, and creating excellent guest experience, any home (for the most part) will make a great STR. STR's are my jam!
It is easy to see you are super motivated and determined to make it would. With that attitude and mindset, I know you will find yourself a top notch house hack