ADUS IN WASHINGTON STATE

[Aravind Guduru]

I am trying to house hack in Washington area and my strategy is to continue house hacking every year or two by purchasing new properties. Currently, I am house hacking in Des Moines (Washington). However, I realized most cities in Washington require you to be in the main dwelling unit or ADU.

How do I house hack if that’s a requirement? Is it not possible to do a series of house hacks in Washington state? Newbie into real estate. Is there anything I am missing ?

[Ryan Xu]

I think you misunderstood the rule. For building up ADUs, yes most cities do have a requirement that the owner must occupy the primary home at the time of applying for the permit and finalizing it. Then condomize them and sell them separately. 

If it is the route you wanna try, go for it. An older home with land now in Seattle will be worth between 500k-1M. And it will cost about $350k to build an DADU and sell it for $700k-ish. Actually, I and my team have done 4 in the past 12 months and have 3 more now in process. This is deftly the most profitable approach here now.

And if you're talking about 'house hacking', it only means you're taking part of the occupancy and renting out the rest part of the property. To do it every one or two years and hold, you do not have to occupy all of them. Most loans for primary home purposes are only requiring you to live in that place for 1 year then you can rent the whole thing out after.