If you have followed our journey at all, you know that we got started in real estate by “house hacking” 12 years ago. This is where you use a portion of your current residence and rent it out (this could be a bedroom, a basement, a garage, accessory dwelling unit, etc). I created a video with more details on that below.
We pay $155 a month to live in a beautiful 4-bedroom, 2.5 bath house with 2200 square feet! It’s amazing not having to worry about much of a mortgage every month where most people consider that their largest living expense!
As we start a new year, investing in real estate can feel a bit overwhelming because there are SO many routes you can go! You can’t do them all and you shouldn’t do them all. One of the easiest and most affordable ways though is house hacking!
Are you considering buying? Maybe you should consider house hacking whatever property you purchase!
People have been scared off by interests rates the last 1.5 years and homes are sitting on the market a lot longer. As a realtor, I always tell my clients to “date the interest rate and marry the house!” Rates will likely go down (probably not as low as they were) and you can refinance, but it’s much harder to sell and move to a new home.
Once rates do drop, there will be an influx of buyers to the market and bidding wars may happen again! Right now, you’re not competing with as many buyers and you can get better terms from the seller (like closing costs, a washer/dryer, etc).
A couple of tips when you’re going to buy:
1) Interview a couple of realtors and find someone that has lived in the market a long time and has a solid track record of helping their clients succeed.
2) Interview multiple lenders and ask about the different loan options.
3) Write out your “must-have list” and “would-be-nice list”. Share that with your realtor.
4) Once you start your house hunt and you find one you like, ask your realtor to check with the listing agent on the type of loan on the house. If it’s a low interest rate, ask if it’s assumable! You may be able to get a 3% or 4% interest rate and save thousands of dollars!
5) Get creative with the space you’re considering. Maybe it has a shed in the back that you can convert into a studio apartment! If you rent that for $1000 a month, it could cover a significant portion of your mortgage! However, you need to consider the costs involved in that conversion and if it’s worth the investment.