Calculate your effective housing cost after rental income from other units
House hacking means buying a multi-unit property (duplex, triplex, or fourplex), living in one unit, and renting out the others. The rental income offsets your mortgage — and with the right deal, tenants can cover your entire housing payment.
The biggest advantage: you can use owner-occupied financing (FHA with 3.5% down or conventional with 5% down) instead of the 20–25% down payment required for investment properties. This dramatically lowers your barrier to entry.
A fourplex is the sweet spot — it's the largest property you can buy with residential financing. After living in one unit for a year, you can move out and turn it into a fully rented investment property, then house hack your next deal.
The best house hacks reduce your effective housing cost to near zero, letting you redirect what you'd normally pay in rent or mortgage toward building your investment portfolio faster.