How it's calculated
Your housing cost = Mortgage + Taxes & insurance + Upkeep − Rent from tenants
Owner-occupied loans allow small down payments, often 3.5–5% on properties with up to four units. That makes house hacking one of the most common ways to buy a first investment property.
Example
You buy a $400,000 duplex with 5% down. The mortgage is about $2,465 a month, plus $850 for taxes, insurance and upkeep. The other unit rents for $2,400, so your housing costs about $915 a month: $885 less than the $1,800 you'd pay renting.
After you move out
When you move on, the unit you lived in can be rented too. Run the cash flow calculator with full rent to see how the property performs as a pure rental.
Common questions
How long do I have to live there?
Owner-occupied loans typically require you to live in the property for at least a year. Check your loan terms.
Can I house hack a single-family home?
Yes, by renting out rooms or a basement or garage unit, as long as local rules allow it.