First-time homebuyer looking to purchase and house hack a quad-plex

Investor · Buffalo, NY · Member since 2019 · 163 posts · 113 votes

@Joseph Shilen great questions, and a lot to unpack in one response. I live/work (and house-hack!) in this neighborhood and know exactly the kind of home you are talking about. Happy to connect offline and discuss further, and connect you with some lenders who will be able to more concretely answer your questions. I’ll shoo you a DM

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Aaron ZimmermanBusiness Member

Accountant · Chicago, IL · Member since 2018 · 2k+ posts · 1k+ votes

7mo

I'd recommend getting in touch with lenders to get preapproved. A lot of your questions can be answered by them. I'd be looking at a 5% conventional loan and if you want to pay 10%, you certainly can.

Usually owner occupied financing is going to be cheapest.

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Brandon CormierBusiness Member

Rental Property Investor · Clinton, MA · Member since 2018 · 38 posts · 27 votes

7mo

Congrats on thinking of making the jump into real estate! a few things to unpack

1- You could easily get a 10% down loan if you're living in one of the units, but depending how much cash you have to put down and how much updating the property needs it may be more beneficial to put 5% down and use the remaining money to update the place and bump the value + fix any issues that may arise. Both of my first properties were 3.5 and 5% down and after bumping the value through some updates and rehab i was able to refinance with 20% equity on both.

2 - All areas are different, i would assume about 3%ish for closing costs but that is a good question for lenders in your area. What i have done for many of my clients however is structuring the deal with a tiny bump in price and ask for 10k+ as a closing cost credit in the offer. This helps bring less down to the closing table and more for doing updates/ or for your next property. Also don't know about what options you guys have in NY but in MA there are plenty of down payment assistance programs that will help cover some closing cost/down payment money and help you keep more in your pocket.

3- as far as the lender usually they will count 75% of the current income of the property as your income and they require some reserves (usually 3months mortgage and tax payments) in the bank. if the property is completely vacant it may be a different story however. but some will count proforma rent if the unit is instantly able to be rented out.

4- rate is usually pretty comparable to a regular house you're moving in most of the time - only if its owner occupied

Best of luck! any questions feel free to shoot me a message

[email protected]978-333-1195

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Bo SmithPro Member

Hinton, WV · Member since 2026 · 1k+ posts · 373 votes

7mo

Buffalo's solid for house hacking. Lenders usually count 75% of rental income for qualifying, so $6k rent becomes $4,500 toward your DTI. Game changer. You thinking self-manage or property management company?

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Henry Lazerow

Real Estate Agent · Chicago, IL · Member since 2017 · 2k+ posts · 2k+ votes

7mo

I house hack a 4 unit and am also a realtor that works with many house hackers. 4 units are the best as they cashflow highest and as rents go up over time it adds up fast being 4x the annual per unit increases. To answer your questions...

1) Most of my clients put down 5% which is also what I personally did. Some put down 10%. The leverage is what makes these give very high returns and the extra year 1 cashflow from having a smaller mortgage really does not matter much in the long term. Save the extra money for some unit updates so can raise the rents.

2) I am in Chicago not NYC but here close costs are 2-3%. 5% sounds really high unless its a really low price point property.

3) No. But they will calculate how much property you can afford based on their calculations of units actual rents or fair market rents if buying vacant. Although not required you want some reserves forsure not even just for vacancy but for repairs that come up, etc. $60k is a lot of reserve I doubt most of my clients have that much reserves per a property.

4) No it will still be an owner occupant rate. Being a 2-4 unit vs a SF your rate may be slightly higher like .125% not significant.

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Mayo Gilfurt

Real Estate Consultant · Connecticut Ct · Member since 2026 · 130 posts · 30 votes

7mo

You’re thinking about this the right way by giving yourself a year. Owner-occupant quads can be a great first move, especially in solid neighborhoods like Elmwood Village.

One thing I'd suggest early is getting clear on which owner-occupied financing paths you want to target (FHA vs conventional) and how condition/age of the property may affect that. That alone can narrow your search and save time later.

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Frankie VozziBusiness Member

Member since 2025 · 359 posts · 89 votes

7mo

Hi Joseph, for an owner-occupied 2–4 unit, this would be done with a conventional loan, With solid credit and income, 10% down on a quad could be achievable for a first-time buyer. Going below that is more limited, so adjusting price instead of leverage is usually the smarter move.

Expect 2–5% in closing costs. NYS assistance may be available depending on income limits, but many buyers at this price point don’t qualify, so planning without it makes sense.

Lenders can use a portion of the projected or existing rental income to help you qualify, and because you’ll live in one unit, you’ll receive owner-occupied rates, not investor pricing. Your reserve plan is solid, and a well-located quad is a strong way to start house hacking, I sent you a Dm, happy to connect!

[email protected]516-888-7750

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Arman AhmedPro Member

Real Estate Agent · Columbus Cleveland Dayton, OH · Member since 2024 · 2k+ posts · 954 votes

7mo

Quote from @Joseph Shilen:

Hello everyone. Been a casual browser as I’ve been saving up for a down payment the last few years and feel I’m getting pretty close to my goal of purchasing a quad and house hacking as a first-time homebuyer, so would like to start getting some answers to some questions I have. I’d like to actively start looking in a year.

My target area is downtown Buffalo in the Elmwood Village neighborhood. Very desirable area close to numerous restaurants, shops and other businesses. Many nearby multi-unit homes are 100+ years old but seems the going rate is between $500-700k for quads that have been kept up well and updated. I’m putting my budget at around $600k. From scoping out the area and knowing several residents living in these types of properties, average rent for a two-bedroom seems to be around $2,000.00/month.

I have some questions, as I have no experience with the application process or landlording and would like to know whether my goal seems feasible for someone buying for the first time.

1. I’ve tinkered around with mortgage calculators and have floated around putting down 10% as the sweet spot for me if a home of this price is what I go with. How difficult would it be to get approved at 10 down for a property of this price with the plan of living in it as a first-time buyer? Putting down any more would be difficult, so I’d probably look for something cheaper if 10 isn’t enough. Is there any scenario that I could get approved putting down even less than 10 with a property of this value if it made sense to do so?

2. I’ve read around about closing costs - should I prepare for minimum 2-5% of the purchase price to close? Is anyone familiar with closing cost assistance in New York State and the requirements to qualify? I might make too much but wanted to inquire just in case.

3. During the approval process, do I have to prove to the lender that I’m capable of paying the full mortgage if the other three units are completely vacant based exclusively on income? Or does a lender consider reserves and what the amount the units can rent for into that equation as well? I’m guessing they look at all factors but say my hypothetical mortgage is $4,500.00 - would I need to prove I can pay that solely based on my income in order to get approved? I think the most ideal scenario would be to purchase a property that already has tenants in at least one of the units upon moving in.

4. Since this is a rental property, would my rate be higher, even if I’m living in one of the units and buying for the first time?

From the numbers I’m going by, if I were to go forward with this, I’m planning on having at least 10% of the property value (around $60k) in reserve upon applying for a mortgage and moving in.

Just trying to make a plan and understand whether I’m biting off more than I can chew here. I see this as an opportunity to live for close to free and possibly even cash flow if the above numbers stack up as I’m anticipating, and I have ample income from my full-time job, so don’t foresee being able to continue to put money in a reserve account for repairs and upgrades once I’m moved in being an issue.

Any thoughts or advice is appreciated. Thank you!

@Joseph Shilen

Love the house hack goal, and you’re thinking about it the right way, but at $500–700k in Buffalo, you’re taking on a pretty big first deal with a thin margin for error. Even with solid rents, higher price + taxes + older buildings can make cash flow tighter than it looks on paper, and lenders will still qualify you largely on your personal income (they may count a portion of rents, but not 100%). A lot of first-time investors end up “house hacking” out of state in lower-cost Midwest markets, where quads or duplexes cost half as much, and the price-to-rent ratios are way stronger, so you can learn landlording with less risk and better cash flow. You don’t have to force your first deal to be local if the numbers aren’t great, sometimes the smarter move is buying where the math is easier and scaling faster from there.

[email protected]614-418-6081

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Mayo Gilfurt

Real Estate Consultant · Connecticut Ct · Member since 2026 · 130 posts · 30 votes

7mo

You’re thinking about this the right way, which already puts you ahead of most first-time buyers.

A few high-level points from the financing side:

• A 4-unit you live in is still considered owner-occupied, so rates and down payment requirements are very different than an investment loan.

• 10% down is possible on a 2–4 unit in many cases, but approval hinges on credit, income stability, and how rents are documented (existing leases help a lot).

• Lenders typically do not require you to qualify on 100% of the mortgage from your income alone — a portion of rental income can be used, especially if units are occupied.

• Rates are usually slightly higher than a single-family, but far better than true investor rates.

Your reserve thinking is solid, and targeting a property with tenants already in place is smart.

If you want, I’m happy to walk through how lenders actually underwrite these deals so you know exactly what to prepare for before you start shopping.

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Jarret Jarvis

Real Estate Agent · Chicago · Member since 2021 · 170 posts · 64 votes

7mo

Hey there, sounds like you’ve got a solid plan and you’re thinking about this the right way already. House hacking a quad in Elmwood Village at 600k is absolutely feasible as a first‑time homebuyer, but it needs to be framed correctly for the lender and your own risk.

Here’s a more natural version you can post:

Thanks for laying all this out, this is a great starting point for a first‑time house hack in Buffalo.

Here’s how I’d break your questions:

Ten percent down on a 600k quad, living in it as a first‑time buyer, can work, but it depends on your credit, DTI, and how the lender treats the rents. You'll almost certainly have PMI at that level, and some lenders will be a little more conservative on 3–4 units. Going lower than 10% is possible (FHA‑style or local first‑time programs), but a lot of sellers in Elmwood Village don't love FHA or long‑time owner‑occupant programs, so it's worth confirming your lender's comfort level before you start touring.
Closing costs in New York are usually around 2–5% of the purchase price, and in Buffalo a reasonable planning number is mid‑3% for a 600k purchase. New York has a few first‑time buyer and down‑payment assistance programs (including Buffalo‑specific ones and SONYMA‑linked options) that can help with down payment and closing costs. They usually have income caps, owner‑occupancy, and lender requirements, so if you’re well above local AMI you might not qualify, but it’s worth a quick look with a local homebuyer‑assistance org or a Buffalo‑based lender.
Lenders will look at your income plus the projected rents and your reserves. They'll approve you based on your residual ability, your salary minus full PITI — but they'll be a lot more comfortable if the rents can cover the payment and you have several months of PITI in the bank. If your mortgage is 4,500 a month, they don't need you to personally cover all of that with your paycheck, but they do want to see that you can carry the payment in a conservative scenario with low vacancy and normal expenses. Buying a quad with at least one unit already rented when you move in is ideal for both them and you.
If you live in one unit, it’s an owner‑occupant loan, not a pure investment loan, so you usually get better rates than true investors. You might still see a slightly higher rate than a standard single‑family, since 2–4 units are seen as higher risk, but it’s not treated like a portfolio rental loan.

Holding around 60k in reserves at 600k is a very strong position and will make lenders feel a lot better. If your numbers are actually giving you close‑to‑free living (your own rent covered by the other units) and some modest cash flow after reserves and CapEx, this is a really solid house‑hacking profile.

If you want, I’m happy to help you draft a simple underwriting template for an Elmwood‑type quad, rents, reserves, and lender‑friendly scenarios, so you can judge each property consistently and see whether your 600k buy box is aggressive, conservative, or right on target.

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Ryan ThomsonBusiness Member

Real Estate Agent · Colorado Springs, CO · Member since 2018 · 1k+ posts · 1k+ votes

7mo

One angle nobody in this thread mentioned: FHA loans are assumable, and they cover properties up to 4 units. If you find a quad with an existing FHA loan from 2020-2022, you can potentially take over a rate in the 2s or 3s instead of today's 6.25%.

On a $500K loan, the difference between 2.75% and 6.25% is about $1,200/month. That changes your break-even math completely. At 6.25% a $600K quad might barely pencil after expenses. At 2.75% it could cash flow positively even before you account for the unit you're living in for free.

The equity gap (what you pay above the assumed loan balance) is covered with your down payment or a second loan. So if you find a $600K quad with a $450K FHA loan balance at 2.75%, you need $150K in some combination of down payment and gap financing. Harder inventory to find in Buffalo specifically, but it exists.

Timeline runs 45-90 days vs a standard 30-day close, processed by the seller's loan servicer. VA loans work the same way and can be assumed by non-veterans too.

For a house hack where the math is tight at 6.25%, a sub-3% assumed rate turns a breakeven deal into something that actually pencils. Worth including FHA and VA assumable inventory in your search criteria alongside conventional listings.

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First-time homebuyer looking to purchase and house hack a quad-plex

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