Today Mark Feaver shares his multi-family house hacking story from Valley Springs, California. 

This case study will shed light on a growing trend – housing hacking. With house hacking, homeowners are able to live for free and dramatically reduce their cost of living. You can tap into this life-changing strategy for free! Grab a copy of our House Hacking Quick Start Guide to get started – it can save you thousands with information you won't find anywhere else.  

House Hacking Case Study

Mark first heard about the idea of house hacking through BiggerPockets. Once he learned that it was possible to lower your housing costs and reach financial independence more quickly, he was very excited about the possibilities.

At the time, he was a server and business owner. With his fiancé on board, he started analyzing potential house hacking opportunities.

The House Hack

Mark first began analyzing properties on the MLS in 2019. After a year of looking for properties and being outbid, he circled back to one of the first deals he had considered. The triplex was still on the market after a year. Mark dug into the details of the property again and decided it would be a great opportunity.

At that point, he started a negotiation process that lasted approximately 5 months. Eventually, the seller lowered the price of the home, and Mark was able to close the deal.

Updating the Units

Mark closed on the property in December 2020. After closing, the property needed some updates that Mark is currently working through. Installing a drainage system for the bottom floor of the home is the first project he is tackling. Once that is completely ready to prevent future flooding, Mark and his fiance plan to finish the rest of the renovation on the bottom unit after they move in.

Luckily, Mark is able to complete most of the intended renovations himself with the help of his brother and father.

The Tenants

Mark inherited tenants when he closed on the property. For now, he is keeping those tenants in place and using RentRedi to collect rent. So far, managing tenants seems to be going smoothly.

The Numbers of the Deal

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

Financing

Mark used an FHA loan with 3.5% down to purchase the $259,800 home with a 3.25% interest rate. With that, he put down $9,000. 

In total, Mark's monthly mortgage is $1,669, which includes principal, interest, taxes, and insurance.

Rental Income

When Mark bought the property, the property was bringing in a total of $2,400 per month. But when he moves into one of the units, the remaining rental units will bring in $1,700 per month. 

  • Gross Rent: $1,700
  • Mortgage payment: $1,669
  • Cashflow before maintenance and vacancies: $31
  • Housing costs before house hacking: $250
  • Total housing savings: $281

The cash flow of the property is positive. With that, Mark and his fiancé will be able to live for free! Currently, the couple is planning to continue saving to pursue their next house hacking opportunity. 

Want someone else to pay your mortgage? Dive into housing hacking with our House Hacking Quick Start Guide. 

The Learning Curve

With the ultimate goal of financial independence, Mark is happy with his decision to start house hacking. In fact, he already plans to house hack again. He offers this advice to anyone considering house hacking, “Read books, listen to podcasts and go to meetups. Find someone who is a few steps ahead who may be looking to do weekly accountability meetups, zoom calls, etc. Create actionable goals each week and hold each other accountable. Analyze deals every week. And TAKE ACTION.”

Although Mark wishes he had pressed for a lower price, he is glad that he took action on his first house hack property.

How to Connect

Want to learn more about Mark's story? You can connect on Instagram, Facebook, or his website – On Point Mobile Bartending.

The Bottom Line

House hacking can set you on a path towards financial independence. With the ability to live for free, Mark is able to put more towards his other financial goals.

Check out next week's case study with Mihir!

If you are interested in creating your own house hacking story, 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, please share your story with us! We would love to showcase your success.