hey guys flippin landlord ninja here kevin the property prince and we are
two guys take on real estate so today we're going to talk about something that our younger audience
especially asks us all the time and that is house hacking yeah it's one of the biggest
things people that are young adults uh probably could stand to benefit from understanding the
full concept so we figured we'd do an entire youtube video for you talking about it to be
honest it's something that if we could go back in time get our into our delorean and go back in time
would actually have done ourselves big time it would have saved it would have been a huge huge
change of lifestyle for us and would have really really fast-tracked us
to building wealth i agree so as always if you could like share comment we really appreciate
it uh we're doing this for free so we're just hoping that uh you guys can help us blow up this
youtube channel and help tell youtube that this is worth content to uh push out to everyone else
what is house hacking what is this topic that we're talking about here you know how can it
benefit this younger generation well i don't know you know some people have actually told
us they thought it was illegal it sounds like you know you're hacking you know and
they said somebody said they're not very computer savvy and i just i was like oh dear
we need to talk about this so uh house hacking is basically kind of a more of a modern term
that's been used to describe how to how to lower your cost of living through owning a property and
i mean that sounds really really simple but a little bit too vague so let's get into the idea of
maybe it's regarding a single family house maybe you're just a regular person you buy yourself a
single family house because you need a place to live a house hacking could be as simple as
renting out other bedrooms in the single family house to you know your friend or somebody else
basically renting out bedrooms yeah yeah i mean utilizing something like uh which is great out
there now airbnb which is a great service that you can do short-term rentals with and it has a great
platform and it allows you to run out pretty much whether it be rooms you can heck you can rent out
part of your backyard but there's just ways that you can bring in income from the single family
property that will help lower your cost of living that's exactly right so the idea would be you know
instead of renting an apartment somewhere paying a landlord and maybe having a roommate or two which
again that's a great smart move to lower your cost you're paying money to somebody else to
live in their home have your own home get your home home there's so many tools available like
fha loans right now to make that much more possible than it ever has been before
you can buy a property and rent out a portion of property to other people which basically lowers
your cost of ownership yep and then you don't have to just do a single-family home once again you can
easily do especially with fha up to a four family and now you have multiple units that can help you
know lower your income not to only that you can use the banks will look at that income coming from
those units and add that to what you call your dti or your debt to income ratio to help make
sure you can qualify for that loan so how crazy is that i mean literally you can buy a multi-family
house it's a house that consists of four dwelling units you could live in one of the apartments in
that property and rent the other ones out now a lot of people just like you said are going to
be quick to say i can't afford to get them more i'll never get approved to get a mortgage on a
big four family house that's too expensive can't do it he just told you the answer to that with fha
on a multi-family house they consider the incoming rents from those other apartments they consider
that toward your income thereby boosting your income helping you qualify for the purchase
absolutely crazy stuff most people don't know that these kind of things exist and this is a
great strategy to get you started i mean could you imagine being 18 and all of a sudden owning a four
family property having well basically with the rents coming in uh covering your living expenses
you wouldn't even have a mortgage you'd have to pay out of pocket you might even have money in
your pocket at the end of the month money in your pocket at the end of the month after that's after
you budget for maintenance expenses to keep the house up and keep it you know fixed up and nice
paying your utilities paying your mortgage taxes insurance and that's money left over that you
can use towards well towards what so buying your next property buying your next property
using some of the awesome tactics we talk about here on our youtube channel like and subscribe
um but crazy enough that sounds like it's a perfect thing so why doesn't everybody do
it well like i said not everybody knows about these strategies but there's also a couple of
other things you want to consider if you're going to start renting out apartments in a multi-family
home yep so uh some of the downsides that we kind of want to point out that you should you know keep
in mind uh is well you're living with other people and with that comes some kind of uh constraints
you can actually you might have to deal with some noise complaints uh or if you have a kid you might
hear other kids running around upstairs if you have a multi-leveled uh multi-family
family you're living on the first floor and hear them stopping down
you're down you're gonna be that neighbor with the broom banging on the upstairs
ceiling you know uh maybe somebody near you in one of the other apartments uh or your roommate you
know that's renting a room in your apartment maybe they're messy you know and you have to deal with
other people's bad habits like you know leaving the toilet seat up or down or wherever it's
supposed to be i think that the toilet seat should be left up that should be his default position wow
comment if tell me i'm wrong i think we got to get him one of those toilets that automatically closed
right spring loaded baby it's going right back up in my household we're going to use a smart toilet
that's smart everything's a smart device these days uh well so there's there you go right there
you have a couple of concerns man i don't you know maybe you want to have just a nice private
single family uh property no problem you're going to be paying obviously a premium for that
but if you can deal with the fact you're going to have some people in close proximity to you
it can be incredibly lucrative well another con is well as you're renting stuff out especially with
long term short term might be a little different like the airbnb right but being long term
you are a landlord and there's some laws and regulations that go along with that wait a minute
so i can't just you know give somebody some keys to an apartment and just like slap slap some rent
charges on them and uh oh so wow okay so yeah what i've always tell people is it's shocking how many
people get into being a landlord it's a business and the amount of people it seems that jump into
opening this kind of a business and running that kind of business without knowing anything about it
it's staggering i would never i always say this i would never open a restaurant without knowing
how to cook which means i'm never going to open a restaurant oh because i don't i burn water when
i try to boil this is true this is true and so um you know this is something you need to learn
about a bit at least a significant bit before you go you know taking on tenants and becoming
a landlord learn that business uh from people like us for instance yep on top of that you're
gonna have uh maintenance requests and if you're living by yourself yeah maybe you can
deal with that little leak underneath the sink or whatever like that but when you have tenants
you need you have a responsibility to make sure those things get fixed in a timely fashion and
maybe you don't have the money maybe you spent it the extra money instead of putting it aside
now you gotta you know work that money out whether it be from your job or whatever so these are some
things that you need to be uh cognizant of it that could come up when you're being a landlord so
he hit the nail right on the head i mean when it's your own place and you're only dealing with really
yourself your responsibility factor is kind of whatever you're trying to choose to make as long
as you're within state you know statewide state laws um but now when you're when you're providing
a service in exchange for money to somebody you're like i said you're like a business and
uh again using the restaurant analogy imagine if you served somebody food in exchange for money and
they complained about it they didn't like it it took longer than they were expecting you're going
to get complaints you're going to get demands for refunds um people that are going to refuse to pay
you for it and you know maybe eviction costs maybe have a bad tenant you didn't screen them really
well or whatever life happened that never happens you never get bad tenants those things don't exist
but yeah you're gonna now have to go through the lovely court process of eviction uh especially
right now during covid that can be a really fun long process yeah so you could have somebody
quite literally living in a home enjoying your your mortgage your repairs your property uh
maybe they're being messy and they're not you know they're not being the most neighborly and they're
not paying you for any of your services you might have to endure that for a very very long time
so i mean this all sounds bad but guess what there are so many other good sides to this and this is
why honestly we wish we had done this uh if we could go back once again in the past and start
all over we would definitely do that and some of the benefits of this is it is one of the best
ways to start off building wealth and why is that because you're now having other people help you
pay down your mortgage yeah you're so you're building that equity you can now also you know
living in that you can put a heloc on there and you can now have equity to you can actually go
buy another rental property yep absolutely um yeah you'll have the experience to know how to handle
tenants now too so it's almost like training wheels you're on site you're always around
so now if you were to use the proceeds from the current property your first house hack property
you can use that to maybe go out and buy yourself another multi-family and get that ball rolling and
now you have a little bit of experience dealing with tenants and you know what if you decide
dealing with tenants renting apartments kicking people out collecting maintenance repairs and
taking those phone calls at all hours of the day or night if you decide that's not for you
but you still want to grow a real estate portfolio there's a solution for that too
yes you can hire people like us property managers to handle that all the headaches for you uh you
will have to budget of course because we do have to charge but uh yeah honestly you know generally
if you're looking at maybe 10 of the collected rent so i mean it's a small price to pay for
uh having a headache-free you know situation and not to mention if you don't know all the
laws well guess what we do that's what we're uh here for and that's what we've been you know
learning over the many years that we're doing this and frankly that's what you're paying for you're
paying for our experts to handle this stuff in a professional manner so you don't have to deal with
the headache or minimize certainly the headache that you'll have to deal with some lawsuits and
the losses so you can spend more of your time looking for the next great deal working the bur
method working on wholesaling driving for dollars or any of the strategies that we teach right here
on our youtube channel and by the way we've got great videos you can check out actually right here
if you want to check out this uh video all about the BRRRR strategy you know it'd be a great uh
one to check out after you finish this if you're interested in real estate you need to know the
BRRRR strategies so make sure you click on that so i hope this was helpful as always guys and i look
forward to catching you on the next one thanks guys keep us updated in the comments awesome