House hacking is a strategy used by real estate investors to live in a property while renting out the other units to cover the majority of the mortgage payment. By doing this, the investor is able to live in the property for little to no cost, while also building equity and cash flow through rental income. Working with HomeRoom now means investors don’t even have to be living at their property.
The key to successful house hacking is to purchase a property that has multiple rooms - single-family homes are a great start. Depending on the layout of the home, there’s often an opportunity to remodel and add rooms (which, surprise surprise, HomeRoom takes care of as well!). Renting out the other rooms separately means you’re covering the mortgage payment, property taxes, insurance, and other expenses..while bringing in passive income.
One big advantage of house hacking is that it allows investors to build equity and cash flow in a relatively short amount of time. By using the increased rental income, investors cover the majority of the mortgage payment and build equity through the appreciation of the property. Additionally, the rental income can provide a positive cash flow that can be used to save for future investments or to cover other expenses.
It's important to keep in mind that traditional house hacking is not without its challenges. Being a landlord comes with its own set of responsibilities, such as dealing with tenants and maintenance issues. This is one of the biggest benefits of HomeRoom - from sourcing, screening, and taking care day to day management of the tenants, investors truly experience a hands-off income flow. Our data science tech also helps make sure that the property is in a strategically good location and that the rental income will be enough to cover the mortgage payment and other expenses.
Whether you’re living in the house and renting out the other rooms or allowing HomeRoom to manage the entire process, house hacking is a great way for real estate investors to get started in the market and to build wealth over time.