Want to own property and have other people help pay your mortgage? Welcome to house hacking — a smart, creative way to start building wealth through real estate. Whether you’re a first-time homebuyer or an aspiring investor, house hacking can fast-track your financial goals while minimizing risk.
In this post, we’ll break down what house hacking is, how it works, and how you can use it to create passive income and long-term equity.
💡 What Is House Hacking?
House hacking involves purchasing a property, living in one part, and renting out other sections to cover your mortgage and expenses. Common setups include:
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Duplexes or Triplexes: Live in one unit, rent out the others.
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Single-Family Homes: Rent out spare bedrooms or convert spaces like basements or garages into rental units.
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Short-Term Rentals: Use platforms like Airbnb to rent out part of your home.
📊 Why House Hacking Is Gaining Popularity
House hacking is becoming increasingly popular, especially among younger generations:
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Millennials: 55% consider the ability to rent out part of their home for extra income to be very or extremely important when making home purchase decisions.
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Gen Z: 51% share the same sentiment.
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All Homebuyers: 39% find this opportunity appealing, marking an 8% increase over the past two years. NBC New York+3National Mortgage Professional+3Defoes+3DefoesPR Newswire+6YR Media+6National Mortgage Professional+6
This trend is driven by the need to manage high home prices and mortgage rates. For instance, in October 2023, the median sale price for a house in the U.S. was $413,874, and the average rate for 30-year mortgages hit 8%, the highest level in 23 years.
💸 Financial Benefits of House Hacking
House hacking offers several financial advantages:
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Accelerated Net Worth Growth: Over 10 years, the average house hacker’s net worth is $104,000 higher than that of a renter.
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High Return on Investment (ROI): One individual reported an 82% ROI in the first year of house hacking, factoring in rental income and loan paydown.
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Tax Benefits: Deductions for mortgage interest, property taxes, depreciation, repairs, and utilities can significantly reduce taxable income. BiggerPockets+1BiggerPockets+1BiggerPocketsNew York Post
🛠️ Considerations Before You Start
Before diving into house hacking, consider the following:
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Zoning Laws: Ensure local regulations permit renting out portions of your property.
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Privacy and Lifestyle: Living with tenants requires a balance of personal space and shared areas.
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Landlord Responsibilities: Be prepared for maintenance tasks and tenant management.
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Financing Options: Explore loans that support multi-unit properties or those with rental income potential.
🚀 Real-Life Success Story
Matt Krueger, who started house hacking in 2015, generated over $258,000 in revenue in 2023 by purchasing, renovating, and renting properties, including short-term rentals. His journey exemplifies how house hacking can lead to financial independence and long-term wealth. Business Insider
🔚 Conclusion: Your First Step Toward Real Estate Wealth Starts at Home 🗝️
House hacking isn’t just a clever way to reduce your living expenses — it’s a proven path to long-term wealth, financial freedom, and early entry into real estate investing. Whether you’re a first-time buyer, a millennial trying to break into the market, or just tired of watching rent checks disappear every month, house hacking can change your financial trajectory.
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Partners Realty Group
(865) 789 – 6677
“Turning Homes Into Income – One Door at a Time.”
