House hacking is when you create income from the property you are living in. There are a lot of strategies to accomplish this goal, but today's article is about the easiest way!
Get a Roommate!
Let’s look at the numbers and why this might be a good option for you:
If you have $30,000 down payment, you could put 5% down on a $600,000 property, this could get you a comfortable home or condo in a decent area.
For this example, let’s say your interest rate is 4%.
So, your $600,000 property MINUS your $30,000 down payment EQUALS $570,000, 30 year mortgage. That makes your monthly payment $2,721. Next, get a roommate and charge them $1,200 / month rent. Your payment is now $1,521 / mo.
Purchase Price: $600,000
Down Payment: $30,000 (5%)
Mortgage Payment: $2,721 / mo
Roommate Income: $1,200 / mo
Net Payment: $1,521 / mo
For a lot of people I know, they are already spending this amount or more on rent!