House Hacking Case Study 52
Today Sean Lunny shares his small multi-family house hacking case study from Providence, Rhode Island.
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Sean's House Hacking Case Study
As a real estate agent, Sean is familiar with helping buyers find the right home. Although he didn't start out as a professional house hacker, he has quickly turned his passion for real estate into three successful house hacks.
Today, he shares his first house hacking adventure from May 2017. At the time, he had recently learned about the idea of house hacking from BiggerPockets. The idea resonated with him because he had always wanted to buy a duplex and live for free on one side.
After hearing the term and reading Rich Dad Poor Dad, Sean knew it was time to start taking house hacking seriously. Once he found out about the low money down options available through FHA loans, he dove right in.
As a real estate agent, he was able to pounce on a property he found on MLS. The property was a duplex. He was able to live in one side with his partner and rent out the other side. At this point, Sean uses a property manager to handle his properties, including his house hacking tenants.
Along the way, Sean had to learn how to manage tenant issues. A few included mending a broken fence and keeping tenants warm with space heaters when the HVAC went down. Plus, he's learned to manage contractors better as he gains experience.
House Hacking Rental Income
- Gross rent: $1,250
- Mortgage payment: $1,810
- Cashflow before maintenance and vacancies: -$560
- Housing costs before house hacking: $550
- Total housing savings: $0
Although Sean wasn't breaking even, he was able to keep his housing costs low and build equity in a property. The savings he built with this property allowed him to buy a second house hack.
As he looks back on his house hacking journey, Sean reflects, “I would’ve gotten less emotional about the first one. I wanted the house and was captivated by the aesthetic of it. I would’ve held out for a better deal with some value add opportunities.” But he applied that knowledge to his second house hack.
If you are on the fence about house hacking, Sean recommends, ” Do it. Yolo. It’s a small sacrifice to start building your wealth, and don’t be turned off by the fear of failing or the fear of being a landlord. There’s a solution to every problem you’ll face and it’s all about being willing to overcome those hurdle to gain a better life for yourself or your family.”
Tip: Get started now
After starting in 2017, Sean is on his third house hack! Get started now to build the portfolio you want.
If you are interested in creating your own house hacking story, then be sure to:
- Connect with Sean on Twitter @sean_lunny or Instagram @Sean_lunny
- Check out our Ultimate Guide to House Hacking
- Listen to The House Hacking Podcast
- 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.
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