House Hacking ROI Calculator
House hacking — buying a 2-4 unit property, living in one unit and renting the rest — is the highest-leverage strategy for first-time investors because it qualifies for owner-occupied financing (3.5-5% down vs 25% for investment loans).
Why House Hacking Beats Buying Solo
Owner-occupied financing requires 3.5-5% down vs 20-25% for investment property. A $450K duplex with FHA 3.5% down needs $15,750 — compared to $112,500 (25% down) for the same property as an investment. Same equity, 7x lower cash requirement.
How To Qualify For The Loan
FHA requires the property to be 1-4 units, you live in one for at least 12 months. Use 75% of projected rent from other units toward your debt-to-income calculation. Lenders verify rents via signed leases and appraiser estimates.
Exit Strategies After Year One
After 12 months you can move out and rent your former unit. The property converts to a fully-rented investment property while keeping the original FHA financing. Many investors repeat the pattern annually to scale a portfolio quickly.
Source: HUD FHA Multi-Family Owner-Occupant Guidelines, BiggerPockets House Hacking Calculator data. Last updated: May 2026.