Kristina has a long history of successful house hacking. Although there have been some bumps along the way, she has built a cash flow positive portfolio through strategic house hacking. Today we will take a closer look at her multi-family unit house hack in Providence, Rhode Island with a young son and partner.

House Hacking Case Study

As a real estate agent, Kristina knows the ins and outs of purchasing a property very well. She has taken that knowledge and successfully house hacked.

Her history of house hacking started in 2005 in Lowell, MA. She purchased a single-family home via an auction for $75,000. She and her former boyfriend spent $30,000 to renovate the property. At some point, the couple broke up and decided to rent out the property for $1,100 per month for two years. In 2011, they sold the property for $135,000. The live-in flip was worth the elbow grease!

The next property Kristina purchased as in Providence, RI. She bought a 4 unit multi-family home for $250,000 in 2015. In order to cover the closing costs and down payment, she had to sell her classic Camaro. But the property was cash flow positive from day one.

In 2019, she moved out of her unit in the multi-family building. At that point, she purchased a condo for $47,000 in cash and spent $12,000 renovating it. By September of 2019, she had rented the condo for $1,150 per month to enjoy a positive cash flow of $820 per month. With a second live-in flip, Kristina is able to pocket extra cash each month.

Today we will dive into the details of her multi-family house hack.

The House Hack

The four-unit multi-family building was in a nice part of Providence, RI. Immediately after buying the property in 2015, it was cash flow positive with the current tenants. Kristina was able to move into the ground floor unit and rent out the other units for a total of $2,275.

Updating the Units

The four-unit building was ready to move into immediately. But over the years, Kristina has made some updates.

In 2016, a pipe burst in the house and caused water damage in 3 of the units. Kristina had to move into temporary housing with her son and pets. Two of the other tenants also had to move out. But insurance paid for the repair of two new kitchens and a new bathroom. While renovating, Kristina put in extra funds to get better materials and make more adjustments. With these renovations, Kristina was able to increase rent to a total of $2,875 per month.

Since the major repairs, Kristina has completed other upgrades herself including kitchen updates, painting, and refinishing the floors. With those updates, she was able to increase the total rent to $3,355 per month. When she moved out in 2017, she was able to rent out her unit for an additional $1,680.

The Tenants

Kristina uses Craigslist, Facebook Marketplace, and word of mouth to find tenants for her units. She doesn’t currently use any software to manage her tenants, but she is looking into Cozy.

The Numbers of the Deal

It’s time to find out exactly how profitable this house hacking strategy was!

Financing

For the multi-family property, Kristina used an FHA loan and put down 3.5%. The interest on the loan was 3.75%. With principal, interest, taxes, and insurance, the total monthly mortgage is $1,952.

Rental Income

The units of the multi-family building rented for a total of $3,355 per month while Kristina and her son lived in one of the units.

  • Monthly housing expenses before house hacking: $0 while living with family
  • Gross Rent: $3,355
  • Mortgage payment: $1,952
  • Cashflow before maintenance and vacancies: $1,403
  • Housing savings:$1,403

Kristina was able to take advantage of positive cash flow while living in this property. After moving out, her positive cash flow has increased dramatically.

The Learning Curve

Looking back, Kristina would definitely house hack again. She has been able to use the savings to invest, pay for her son’s private school, and pursue a career that she enjoys instead of worrying about her income. In fact, she quit her 6-figure corporate job at age 30 to pursue being a real estate agent full time. With that, she considers herself barista FIRE.

If you are considering house hacking, or real estate investing, Kristina recommended thinking of it as an opportunity. Try not to let the nitty-gritty details stress you out. Instead, take advantage of the opportunity to build a better life.

Get In Touch

If you are interested in Kristina’s story, then you can connect with her on Instagram @ahomeinri or Facebook @Kage15. You can also check out her website, A Home In Rhode Island.

The Bottom Line

Kristina has changed her financial future for the better with the help of house hacking. With a solid cash flow each month, she is able to pursue a career that she enjoys.

If you are interested in creating your own house hacking story, then check out our ultimate guide, listen to our house hacking podcast, or read more case studies for inspiration. You never know how dramatically your life can change through this one choice!

If you choose to pursue a house hack of your own, then please share your story with us! We would love to showcase your success, like we have with other case studies.

Sarah Sharkey
Sarah Sharkey

Sarah Sharkey is a personal finance writer who enjoys helping people make better financial decisions. You can find her work in publications such as Bankrate, Business Insider, Money Under 30, and her own site – Adventurous Adulting. If she isn’t writing, you’d likely find her exploring her home state of Florida.

You can connect with her on her blog Adventurous Adulting.