Pros and Cons of Housing Hacking…is it right for you?

Are you thinking about house hacking? Want to know if it’s right for you or if you can take advantage? Don’t worry we’ve got you covered! House hacking has been taking the nation by storm with more and more people using it as a way to make money and save for the future. However, it’s not all glamorous. There can even be some drawbacks and some things you need to know before you try house hacking. Here are some of the pros and cons of house hacking that you need to be aware of.

Pros

1. You can turn a profit
2. You can write off some expenses as taxes
3. Gain experience when it comes to managing a business

Cons:

1. You have to live with someone else
2. You can’t really have a family and house hack
3. You have to market your available rooms

Pros: 

You can turn a profit.

Obviously, the best reason to consider house hacking is the ability to not only live rent-free but possibly make a profit. In short, you have tenants who will pay off your mortgage on a house that you buy. Instead of spending money every month on your mortgage, you can pay that into a retirement account. The best part? You make money every month by doing very little.

You can write off some expenses during taxes

House hacking is kind of like running a business, which means you get to write some things off on your taxes. Taxes on a home can be expensive, but house hacking allows you to use your house for special tax purposes. If you’re looking to use one of your most costly assets to its fullest potential, then you should definitely consider how to hack. Just make sure to invest in a professional CPA to help you with this process.  

Gain experience when it comes to managing a business

House hacking can give you good experience for running a business. Specifically, running a real estate business. You can put this experience on your resume, or leverage this opportunity into buying up more real estate. If you are looking to start learning how to run a business without leaving your home this can be the perfect option for you.

Cons:

You have to live with someone else

One of the most overlooked cons to house hacking is that you have to live with someone else. Not only are you going to want your own space and privacy, but the other person will as well. You’ll also have to coordinate with this person whenever you want to invite guests over or throw a party. Also, there’s always the possibility that you have someone live with you who is not going to be a very good person. When that happens, it can cause you a lot of financial and mental stress. If you don’t want to take those risks, then house hacking may not be for you.

You can’t really have a family and house hack

House hacking is usually for people who are single. If you have a family, it becomes much harder to make it work. You’d have to expose your family to this other person that you really don’t know. It can also be very hard on children. While the cash might be nice, the peace of mind is worth more than gold.     

You have to market your available rooms

While it may be nice to think that your rooms will always be filled with tenants, that’s not always the case. You’re going to have to do a bit of marketing much like any business. You will most likely have to stage the rooms and your house when trying to find a tenant. You may need to sell them on why this is the right neighborhood for them. House hacking is going make you have to be a “Jack of all trades”.

Do you know what can make this easier though? Finding the right house in the right neighborhood, and learning how to stage a home from an expert realtor. If you’re looking for help to find the best house for you to start house hacking, we can help at MWT Realty Group. We have the expertise and know-how to put you in the best home for your needs. Contact us today and let us help you!