TL;DR: House hacking—living in one unit of a multi-family property while renting out the others—can dramatically lower your housing costs and jumpstart your investment journey. But it’s not always as easy as the YouTube videos make it sound.
What is house hacking?
House hacking means buying a duplex, triplex, or even a single-family home with extra bedrooms, living in one part, and renting out the rest. The rent from your tenants helps cover your mortgage and expenses—sometimes letting you live for free (or even make money each month).
Why it works
- Rental income offsets your biggest expense: housing.
- You can use low-down-payment owner-occupant loans (FHA, VA, etc.).
- You build equity and benefit from appreciation while tenants help pay down your loan.
What to watch out for
- You’re a landlord: expect calls about leaky sinks and late rent.
- Vacancy and repairs can eat into your cash flow.
- Privacy is different when you share walls or common spaces.
Run the numbers
Use Housalyzer’s House Hack Calculator to see how much you could save (or earn) by house hacking in your market. You can configure the options in the rental income form of the mortgage simulation.
Pro Tip: You can duplicate the simulation and compare with or without rental income!
Real-world example
A friend bought a triplex, lived in one unit, and rented the other two. The rent covered 90% of the mortgage and expenses. After a few years, he moved out, kept the property as a rental, and used the equity to buy his next place.
Is it for you?
If you’re comfortable with the landlord role and want to accelerate your path to financial independence, house hacking is a powerful tool. But run the numbers, be realistic about the work, and make sure you’re ready for the tradeoffs.
Disclaimer: This is not financial advice. Always consult a qualified professional before making investment decisions.