It doesn’t matter if you are a new or inexperienced real estate investor, it’s likely that you’ve heard about house hacking and how you can use it to earn passive income.
If you’re considering house hacking but don’t know how to get started, this article will provide you with several strategies that you can use to get started with house hacking and earning passive income.
House Hacking Tip #1 – Use A Low-Down Payment FHA Loan And Earn Passive Income
The first way to get started with house hacking is also the easiest. Thanks to low down payment FHA loans, it’s possible for any real estate investor to get started with house hacking by purchasing a duplex, or fourplex with a low-down-payment mortgage loan.
Once you purchase a small multifamily property, you can live in one of the units in that building (even with a roommate) while renting out the other units to tenants.
Depending upon where you live in the United States, it may be possible for you to get started with this house hacking method for as little as 3.5% down when you choose an affordable FHA loan that they offer to first-time home buyers.
This method is not going to be for everyone, the beauty of it is that if you can adjust to living with a roommate, and being a landlord, you can earn passive income that you can use towards covering your mortgage and Housing costs.
House Hacking Tip #2 – Rent Out Rooms In Your Home
The next way to earn passive income through house hacking is to rent out one or more of the rooms in your home.
This is by far one of the most common ways that people get started with house hacking because the average homeowner typically has one room in their home that they are not using.
It makes sense to rent out that empty room because, once it’s occupied, it’s possible to earn good cash flow from that room every month that you can use towards paying your mortgage and other housing costs.
House Hacking Tip #3 – Live In A Trailer While Renting Out Your Residence
Another house hacking tip that you can use to earn passive income in 2021 is to live in a trailer on your property while renting out your primary residence.
This house hacking tip may not be ideal for some people, especially when you consider that most homes in the United States don’t have ample space on the property for a trailer, but if your property does have space for a trailer, it may be a strategy that you should consider.
Achieving financial independence does take some sacrifice, and time, but if you’re willing to work for it, utilizing this house hacking tip could be a great strategy for you especially since there are a wide variety of trailers available for sale today that are in good condition and cost less than most used cars.
House Hacking Tip #4 – Invest In An Accessory Dwelling Unit For Your Property
Let’s say that you’re committed to the idea of earning passive income through house hacking but, you don’t like the idea of renting out the rooms in your home.
The good news is that it’s still possible to get started with earning passive income from house hacking when you invest in an Accessory Dwelling Unit (ADU) for your property.
Accessory Dwelling Units have been all the rage over the last five years, especially on the West Coast, where cities from San Diego to Portland Oregon have been making it easier for homeowners to have ADU’s placed on their properties.
There are a wide variety of ADU’s on the market today and it’s quite possible that if you do some research in your local area, you may be able to find one or more companies that sell pre-manufactured Accessory Dwelling Units for good prices.
You can always have an ADU built from the ground up on your property but, keep in mind that it’s going to take longer to build one from scratch because, you’re going to have to have plans drawn up by a local architect, approved by your Planning Commission, then hire a contractor to build the Accessory Dwelling Unit for you.
House Hacking Tip #5 – Try A Live-In Flip
Last, of all, another creative House Hacking Tip that you should consider is the live-in flip.
With this House Hacking method, you’re going to purchase a property that needs work, and live in that property for at least two years while you fix it up.
You may be wondering why two years? Thanks to IRS regulations, you have to live in the property for two years but you also don’t have to pay any capital gains up to the first $250,000 if you’re single, and $500,000 if you’re married.
If you have the desire to fix up a property that you invest in, this may be a house hacking strategy for you to consider.
Contact Trier Financial
Once you get started with house hacking, the next step that we encourage every investor to take is to invest in multifamily properties.
With a multi-family property, you’re going to earn more cash flow every month than you would from investing in single-family properties because duplexes, fourplexes, condominiums, or apartment buildings have more doors and when you have more people living under one roof, you earn more income.
Sadly, many people get started with investing in multifamily properties every year but they ultimately flame out because they try to manage the properties themselves and they can’t handle the responsibility of property management. Don’t let this happen to you.
Your goal should be to invest in a multi-family property then hire a property management company to manage that property for you so that you can earn passive income from multi-family investing and have more time to focus on growing your portfolio of multifamily properties.
At Trier Capital, we are a private equity firm that makes it easy for you to passively invest in lucrative apartment building syndications.
Our simple step-by-step process allows you to accelerate your wealth creation so you can live a magnificent life on your terms, whether that means traveling the world, spending more time with family and friends, or making an impact.
To learn more about our process for investing in multifamily properties, or to partner with us, contact me today by calling (630) 229-2383 or click here to connect with me online.