New Milwaukee Investor
What are some of the best areas to do a house hack in? I've lived in Milwaukee for several years, and am moving back and looking to invest. I am curious what people think are some of the best areas for this. I'm looking for a 2/2 or 3/2 duplex where I can live in it and rent the other. I also like living in prosperous safe areas, so I'd want to keep that in mind. I'm okay with an older home that needs some cosmetic TLC. I had the Bayview and Wauwatosa areas in mind, but I'd like to pick the brains of those of you in this forum. Thanks in advance.
Also, Cudahy and West Allis could be good areas for you.
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Wauwatosa is a top choice, Washington Heights offers a similar feel minus the school district and at a lower price point. Bayview has gotten a bit expensive for what you get, some neighborhoods are pretty crummy (worst sidewalks in town!), depending on location. For a lower budget West Allis is great, I am a big fan - it has not been hyped up as much, but very commercial friendly municipality hard at work. Shorewood marks the top end of pricing, lower east side is up there too, but very UWM influenced. Greenfield has some "newer" (1960) side by side, which feel much different than the typical Milwaukee upper/lower configuration. Once in a blue moon you see one in Brookfield as well, but they are usually rough and expensive, not a good combo. If you want to dodge the high property taxes you can look in Cedarburg and Port Washington, but you have to be patient, those are tiny markets. West Bend is also an option, but that's quite a drive.
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@Marcus Auerbach you think Cedarburg has options for a duplex house hack? Seems like the prices are pretty high for rentals in Cedarburg.
Those are both great areas for house hacks. I think sticking to some of the tertiary markets surrounding Milwaukee you will find better luck with duplexes in good parts of town
The other important thing the OP is missing is the price range as that will help narrow down the areas.
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Quote from @Dave Carpenter:
@Marcus Auerbach you think Cedarburg has options for a duplex house hack? Seems like the prices are pretty high for rentals in Cedarburg.
Yes, we have done a couple in Cedarburg, financially not more of an issue than Shorewood, because keep in mind rents are very high too, so that makes up for it. The issue is that you have to be patient, because it's a tiny market and there is not always a duplex for sale. But worth it.
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Real Estate Agent Wisconsin (#82198-94)
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@Marcus Auerbach i agree about the small Market. Let me know if you’re selling ;)
I think over the last few years it’s been hard to get the 1% rule of thumb. Rents are higher, but purchase price I’d say is higher than that.
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Quote from @Dave Carpenter:
@Marcus Auerbach i agree about the small Market. Let me know if you’re selling ;)
I think over the last few years it’s been hard to get the 1% rule of thumb. Rents are higher, but purchase price I’d say is higher than that.
Not selling, but you see one here and there. And for a house hack you don't need the 1%. I think you were thinking of it as a cash flowing rental property.
A single family starter home in Cedarburg may cost you about $2,200 monthly with 10% down. That's the base line.
A nice duplex will cost you let's say $3,000 monthly, but you get probably $1,600 in rent, leaving you with 1,400 out of pocket. That's 800 less than the single family would cost you.
Plus you get about 3% mortgage pay down p.a. on the 90% you have financed, so that's a 30% ROI on your down payment (most of it paid by the tenant) and that's before we take appreciation and tax write offs into account.
The "worst" house hack will always beat any single family home deal.
Could you buy a cheaper duplex in West Allis and live there with less out of pocket? Yes, absolutely. Will you make more $$ long term and meanwhile enjoy living in Cedarburg, also yes.
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Real Estate Agent Wisconsin (#82198-94)
- 262 671 6868
- http://www.OnPointRG.com
- [email protected]