House Hacking 101 from from a soon to be college graduate.

Dated: March 26 2020

Views: 276

As a young adult soon to enter the world of renting and home owning, I’ve found a unique alternative to the typical home ownership. House hacking is when you buy a multi-unit property, where you would live in one unit, and then you would rent out the other units. Renting out the properties gives you income to help pay for almost all your living expenses and mortgage. The extra cash set aside after the rental property has been paid can be saved up easily. This allows for housing costs to be cut down to benefit you financially. For people my age, this is an extremely helpful way to gain money and experience of home owning under your belt. 

Typically, after coming out of college, renting an apartment is the normal way to go. House hacking is different because you become the landlord, taking rent from those who rent the other parts of your property. It is a risk because there would be money needed to invest in the property along with fixing it up, but in theory you should make back all the money put into the property and more.  

Outside of living for relatively free on your own property, house hacking comes with a variety of other benefits as well. You need a 20 to 25% down payment so you’re able to get a loan from a bank, but house hacking you can get a much smaller loan. Loans like the VA loan or FHA loan allow you to invest in a property with a smaller down payment. House hacking gives you credible experience so banks will give out much larger loans if you’ve successfully house hacked. 

Overall, house hacking is a great way to get into the home owning world. It allows you to essentially live for free, and you can do it with friends/roommates as well. Although it is a bit of risk, it can pay off easily in the end. Graduated and fresh out of college, this is definitely a beneficial way so rent isn’t necessarily a problem and you save a ton of money.

Thank you.

Amy Szmik

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