House hacking case study

House Hacking Case Study 53

May 12, 2021 | Case Studies

 Today Sher Jones shares her small multi-family house hacking story from Atlanta, Georgia. 

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Sher's House Hacking Case Study 53

Sher started her house hacking journey because she wanted to get into real estate investing. But she didn't have extra money floating around to invest in a rental property. When she discovered the idea of house hacking, she decided that this was the perfect way for her to learn about real estate investing,  property management, and save money for investments down the road.

Once Sher decided that house hacking was a good fit for her, she started looking for a property in October 2020. After months of searching, she closed on a property in March 2021. She found the property with the help of  a great real estate agent that remained engaged throughout the process and uncovered a duplex on the MLS that has been incorrectly listed.

Sher bought the property with an FHA loan using a 3.5% down payment. This amounted to around $10,000 at closing to obtain the move-in ready property. So far, Sher has enjoyed her house hacking adventure and already has a tenant moved into the second half of the property. She found her tenants through Zillow, Apartments.com, and Facebook Marketplace.

For now, Sher is managing the tenants herself through a property management company that her set up. Plus, she uses Innago to streamline the process, and Stessa for business expense tracking.

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House Hacking Rental Income

Now it is time to see just how profitable this house hack was.
 
Sher used an FHA loan to put down around $10,000 on the house.
 
  • Gross rent: $1,100
  • Mortgage payment: $1,279.20
  • Cashflow before maintenance and vacancies: -$179.20
  • Housing costs before house hacking: $1,200
  • Total housing savings: $1,020.80

Although Sher is paying a small portion of her mortgage each month, the majority is covered by her tenants. With that, she is able to save on housing costs and build equity in a property. Sher plans to use the savings to build up a down payment for her next property. 

The Learning Curve

Looking back, Sher wouldn't change her house hacking choices. She does wish she had learned about real estate and financial literacy sooner. However, she is glad that she was able to have a fun time in the year following her education and got the spending out of her system without making any major financial mistakes. 

If you are considering house hacking, Sher definitely recommends it. She says, “It is a new freedom when you own a home, getting the loan pay down by someone else, saving money and are not house poor.”

Additional Resources

If you are interested in creating your own house hacking story, then be sure to:

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