House Hacking: How to Run the Numbers
House hacking — living in one unit of a small multifamily (or renting rooms) while tenants help cover the mortgage — is the lowest-risk on-ramp into real estate. It also lets you use owner-occupant financing with a small down payment. But "the tenants pay my mortgage" is a slogan, not an analysis. Here's how to check whether it actually works.
Analyze it two ways
- While you live there: how much of your total housing cost (mortgage, taxes, insurance, utilities) do the other units cover? Your real number is what you pay out of pocket to live — compare it to renting.
- After you move out: re-run it as a straight rental with every unit leased at market rent. This is the number that tells you if you bought a good investment, not just a cheap place to live.
The trap: a house hack that's great while you live free can be a mediocre rental once you leave. Underwrite the "moved-out" scenario before you buy — that's the deal you'll actually own for years.
Don't forget the owner-occupant costs
Budget the same vacancy, maintenance and CapEx reserves you would on any rental. And remember your own unit produces no rent while you're in it — count that honestly rather than pretending the building is fully leased.
Why it de-risks the entry
Lower down payment, lower monthly housing cost, and hands-on landlording experience on a property you live in. If both scenarios — occupied and moved-out — clear your bar, a house hack is one of the strongest first moves in real estate.
Model both scenarios. The EYRIE Deal Analyzer lets you run the occupied and fully-rented cases side by side. See it on Etsy →