Future house hack

Member since 2024 · 3 posts · 1 vote

Hi everyone,

I want to move to Florida and have been looking at the North Port area and nearby cities. My goal is to house hack using an FHA loan with 3.5% down.

The duplexes I've been looking at typically rent for around $1,200 per unit, while the estimated mortgage payment, taxes, and insurance would be about $2,200 per month.

Am I looking in the wrong area, or is this fairly normal in today's market? Should I be factoring in future rent increases, or is it better to base my numbers only on current rents?

This would be my first house hack, so I'd appreciate any advice. Thanks!

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Aaron ZimmermanBusiness Member

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

3mo

What you're looking for in a house hack is decreasing current expenses and having the property cash flow upon moving out. It doesnt Seem like that property meets the second objective for sure because you're only factoring in PITI.

I would recommend looking into MTR, STR, or rent by the room to boost cash flow and run the analysis.

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Aaron ZimmermanBusiness Member
Accountant · Chicago, IL · Member since 2018 · 2k+ posts · 1k+ votes
3mo
What you're looking for in a house hack is decreasing current expenses and having the property cash flow upon moving out. It doesnt Seem like that property meets the second objective for sure because you're only factoring in PITI.

I would recommend looking into MTR, STR, or rent by the room to boost cash flow and run the analysis.
[email protected]
Brick House CPAs53 Reviews
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Minho Lee
Real Estate Agent · Worcester, MA · Member since 2026 · 114 posts · 53 votes
3mo
You do want to make sure you're factoring in all the real expenses. That includes PMI, vacancy (I usually underwrite at least 5%), maintenance, CapEx, and rising insurance costs over time.

On rents, it’s best to base your numbers on current market rents, not future projections. If rents go up, that’s a bonus—but you don’t want to rely on that to make the deal work.

If you’re coming in around $2,200 in expenses and about $1,200 from the other unit, your effective housing cost is still significantly reduced, which is one of the main benefits of house hacking. The key question is whether that remaining out-of-pocket cost makes sense for you and if the property works well as a full rental after you move out.
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Alan AsriantsBusiness Member
Real Estate Agent · Philadelphia, PA · Member since 2019 · 1k+ posts · 1k+ votes
3mo
If you can cover your expenses and even make a few hundred bucks GROSS while putting only 3.5% down - that's a decent deal. This is of course if the home is in decent shape no major issues etc.
We need to really reframe how we look at deals. We can't expect to rake in cash flows when the bank owns 96.5% of the assest. The fact that we can even cash flow off of that investment is great!
Hope this helps
[email protected]267-767-0111
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Todd AndersonPro Member
Real Estate Agent · Cape Coral, FL · Member since 2023 · 392 posts · 175 votes
3mo
@Trent Pappas,
Welcome to the REI world and BP.
This is a great question. You are on the right track with house hacking. It is definitely the way I would suggest all investors get started if they are able. And further I believe that starting with a duplex is the best strategy.
It seems that your numbers are in line with what I would expect. You left out some key info like size of the unit, the interest rate that you are looking at, and if you are looking to do the management yourself. These are some of the biggests factors to the ability to cashflow or cover expenses. That being said I don't believe that I have seen a duplex cover a buyers side, if they are living in the unit, for a long while. The other big factor is the amount down. There are not may deals that I have seen, unless there is major renovation that look good with under 20% down.
Rents in this area have seen some suppression after the covid boom was over. It looks to me, in working with the investors that I do, that we are starting to see a stableasation and some rent improvement lately.
The one piece of advice I would give an investor in your situation is to look at a conventional loan not FHA. With an FHA loan you will be stuck with the PMI for the life of the loan. the only way to remove it is to refinance. With a conventional loan you will be required to put down 5% but you can have the PMI removed once you can show 20% equity. Many times that PMI is the difference between cashflow and not.
I would be happy to answer any more specific questions you would have, so feel free to reach out.
[email protected]651-492-5652
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Amber Stout
Lender · Tampa/Saint Petersburg, FL · Member since 2014 · 356 posts · 148 votes
3mo
Hi Trent, this is normal in today's market.

If cash flow is a concern, you can get creative with the offer structure. For example, seller credits can be used for a rate buydown, which may help improve cash flow. There are also FHA ARM options that can offer lower rates depending on market conditions.

That said, I would be very conservative with the rent numbers you use when underwriting the property and would not assume future rent increases. If the deal works today based on current rents, that's a much safer approach.

I have personally done house hacks and also help on the lending side with house hacks. I'd love to help!

To make the numbers work in this market, creativity in the deal structure often matters just as much as finding the right property.
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Juan Yepes
Lender · Miami, FL · Member since 2025 · 121 posts · 33 votes
3mo
Hi @Trent Pappas,
If you are looking to house hack where the potential revenue is the highest, then you would look in areas where short term rentals have a good inflow of visitors (ie. tourism areas). These areas/properties will likely be above the price range you are finding in North Port area. You'd need someone to advise you on how much financing you would qualify for to see if this is out of your range.
If you are looking at house hacking in residential areas where the price/monthly payments are low, then you will need to work your numbers based on long term rent (12 month lease agreements) since this is the type of tenant in the more residential areas.
For financing, you only need to consider rental income + your income against PITI (principal, interest, taxes, and insurance). This is for qualifying for a mortgage. But to really understand if this property would be a good investment, you should also consider things like maintenance, repairs, tenant property management fees, etc.

We help dozens of people every year relocate to Florida from out of state. Happy to connect and provide some more in depth guidance.
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- Trent Pappas
  OP
  Member since 2024 · 3 posts · 1 vote
  2mo
  Quote from @Juan Yepes:
  
  Hi @Trent Pappas,
  If you are looking to house hack where the potential revenue is the highest, then you would look in areas where short term rentals have a good inflow of visitors (ie. tourism areas). These areas/properties will likely be above the price range you are finding in North Port area. You'd need someone to advise you on how much financing you would qualify for to see if this is out of your range.
  If you are looking at house hacking in residential areas where the price/monthly payments are low, then you will need to work your numbers based on long term rent (12 month lease agreements) since this is the type of tenant in the more residential areas.
  For financing, you only need to consider rental income + your income against PITI (principal, interest, taxes, and insurance). This is for qualifying for a mortgage. But to really understand if this property would be a good investment, you should also consider things like maintenance, repairs, tenant property management fees, etc.
  
  We help dozens of people every year relocate to Florida from out of state. Happy to connect and provide some more in depth guidance.
  
  Thanks for the information! I really appreciate it.
  
  I'm going to be an elementary school teacher, so I'm mainly looking for areas that have good schools, are affordable on a teacher's salary, and offer the lifestyle I'm looking for. My plan is to house hack my first property while continuing to build my real estate portfolio over time.
  
  I'm still in the learning phase, so I'm trying to understand how investors accurately estimate expenses like insurance when analyzing deals. Thanks again for taking the time to help.
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Jimmy LieuBusiness Member
Real Estate Agent · Columbus, OH · Member since 2019 · 3k+ posts · 2k+ votes
3mo
Quote from @Trent Pappas:

Hi everyone,

I want to move to Florida and have been looking at the North Port area and nearby cities. My goal is to house hack using an FHA loan with 3.5% down.

The duplexes I've been looking at typically rent for around $1,200 per unit, while the estimated mortgage payment, taxes, and insurance would be about $2,200 per month.

Am I looking in the wrong area, or is this fairly normal in today's market? Should I be factoring in future rent increases, or is it better to base my numbers only on current rents?

This would be my first house hack, so I'd appreciate any advice. Thanks!

Great question and welcome! I would definitely underwrite the deal using current rents, not projected rent increases. Future rent growth is nice when it happens, but I never count on it when deciding whether to buy. Looking at your numbers, if the duplex brings in about $2,400 total rent and the payment is around $2,200, that's actually not bad for a house hack since you'll be living in one unit and benefiting from the tenant helping cover a large portion of your housing cost. I'd also make sure you're accounting for maintenance, vacancies, and capital expenses so you have a realistic picture. One thing I've noticed is that many newer investors focus only on whether the property completely covers the mortgage, but reducing your housing expense by several hundred or even over a thousand dollars a month can still be a huge win. If you're comparing markets, pay attention to areas with strong job growth, population growth, and reasonable purchase prices relative to rents. I've found that some Midwest markets still offer opportunities where duplexes and small multifamily properties can come surprisingly close to covering themselves, even with today's rates. Happy to connect and answer any questions you have!
[email protected]614-300-7535
Jimmy Lieu, Red 1 Realty4.9120 Reviews
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Raymond J. RodriguesBusiness Member
Lender · Miami, FL · Member since 2017 · 1k+ posts · 797 votes
2mo
@Trent Pappas I would say that estimating around .5-.6% of the sales price is a fair estimate of homeowner's insurance, depending on the age, condition and area that the property is located in. Feel free to reach out with any questions!
[email protected]619-456-8311
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