House hacking is not at all a new concept but it’s got a new, trendy name these days. It’s basically becoming a landlord in your own home and/or having roommates that essentially cover all of your expenses for you so you live almost free. 

The rent you charge each tenant is what you deem is fair given the current rental market averages in your area and you charge that amount to include utilities; either by room rate if it’s a single family home or unit rate if you bought a duplex, triplex, 4-plex type property. Those rents will cover your mortgage, utility costs, insurance, maintenance reserves, and potentially even more to put into your savings account!

Most of us did this back in the day because we were flat broke and had no other option than multiple roommates and sharing the bills. While it’s not ideal for everyone, if you’re having significant financial struggles or job loss, it can be a temporary solution to save your home, keep the AC on, and food in your belly. 

If you’re a single person or couple especially, this is a great way to get into a three bedroom home now that you can purchase for 3.5% down with a standard FHA loan and not pay a dime for while you also buy and hold to either sell for profit in a few years OR eventually turn into your family home when it’s time to start one. Remember: homeownership also comes with tax benefits!

If you’re a single woman or family who needs the extra income but you are concerned about safety, you can also rent out to traveling nurses and fellow working single moms or professionals who are not around much and make excellent renters while paying down some of your debts and expenses. 

Of course, make sure you run full background checks on anyone coming on to your property as well as credit checks, verify employment, have standard property rules in place, and HAVE A LEGITIMATE LEASE AGREEMENT written by a real estate attorney to help you protect your assets and rights. Require a security deposit and have someone who can be an authority on property when needed whether it’s you, family, or friend. A property manager may end up a great addition as well if you can. A candidate with a stable job and proof of payment history is a wonderful start. Don’t even bother otherwise! Make sure they fill out an application and pass your checks before showing the property physically. You can also hire an agent for a small fee if you wish. Let me know how else I can help you.