FINDING HOME
Can We House Hack in New York?

Imagine being 8 months pregnant, studying for the bar exam, and planning to move in the next 2 months.

That was Carmen’s reality, when her husband, Elliot, shared his latest investment idea with a strong sense of urgency.

Their lease was coming up, Elliot’s company stock options were liquid, and mortgage rates were expected to rise. If they were going to find a way to house-hack, he felt this was the time.

While many purchase a multi-family with the goal of offsetting their mortgage through rental income, Elliot and Carmen hoped to find a home that would satisfy their family’s needs while also greatly minimizing their monthly expenses.

Here were their priorities:

• A 2 family townhouse northwest of Prospect Park

• Move-in ready, no renovations needed

• Potential rental income had to cover more than 50% of their mortgage and taxes over the next few years

Among their options:

No. 1:
The Landmarked Limestone

This bay-front limestone had been recently renovated and was fully turnkey. It took form as an upper duplex and a first floor rental, with a manicured rear lawn only accessible from the first floor. To achieve their house hacking goals, Carmen and Elliot would occupy the first floor one bedroom apartment for the first few years with their baby, then move to the upper duplex as they grew. The railroad layout would have their bedroom or living room windowless on the garden floor — which was less than ideal — but the home’s interior architecture was extremely appealing to them. They especially loved the home’s facade, and the beautiful block of bay-front limestones in varying colors.

No. 2:
The Classic Brownstone

The only brownstone on our list, this home was also laid out as a simple upper duplex with a first floor rental. This home sat on a tree-lined street with another well laid out rear yard. The garden could be accessed both from the first floor and the parlor level, offering a shared backyard for both units (and thus greater rent potential). In this home, they also intended to live on the first floor rental for the first few years - although thankfully, the garden apartment had two full bedrooms, both with windows to the rear. Living on the lower floor would be sustainable for much longer with such a setup, and the far majority of their monthly expenses would be covered with the upper duplex rental income. However - the current occupants wouldn’t be able to move out until after Carmen and Elliot’s due date.

No. 3:
The Yellow Double Duplex

This double duplex would have Carmen & Elliot downstairs, and tenants above them in a 3 bed / 2 bath unit filled with light. With the trajectory of rental income, it would take only ~3 years for the majority of their monthly expenses to be covered. But with the layout and squarefootage of their lower duplex, they’d feel very comfortable over the next several years. This home also sat on an historic block, right outside of the landmarked zone, so they could enjoy the beauty of the block without being subjected to LPC facade regulations themselves. The interior had an outdated renovation, but could satisfy their needs for the first few years.

*names have been changed

Which Home Do You Think They Chose?

THEIR HOME:
THE YELLOW DOUBLE DUPLEX
I had taken three different buyers to view this home - I knew it was a good deal for a house hacker, and just had to find the buyers who were ready to take that on. Most two-family purchasers are looking to occupy the majority of the home, and only offset the mortgage a bit with a garden rental. Most owners also prefer to maintain access to the garden without having anyone live above them. Those elements combined made this home have a far limited buyer pool. A tighter buyer pool spelled out a great opportunity for Carmen & Elliot, and I’m glad they had the vision for this house.

Since purchasing this home, they’ve had two beautiful babies, and have become super close friends of mine. They’ve bonded with their next door neighbor and have taken down the fence to create one giant backyard. We found their upstairs tenants before closing, and they intend to stick around for the long haul.

I’m so glad we could make this happen for Carmen & Elliot, and am immensely impressed by Carmen for moving, giving birth, and taking the bar exam all in the span of two months. She is superhuman to say the least!

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