House hacking is a strategic approach to real estate investing where individuals purchase a property, live in part of it, and rent out the other parts to reduce or eliminate their living expenses. This calculator is designed to help potential house hackers estimate the financial benefits and considerations of such an investment. By inputting various parameters like mortgage payment, rental income, and other monthly costs, users can gain a clearer understanding of the potential returns and expenses associated with house hacking.
Calculate The Profitability of House Hacking
Please input the required fields (*) below to calculate an apartment’s size.
House Hacking Calculator
This calculator is meant for educational purposes only. The calculation generated from this calculator does not, and is not intended to, constitute financial advice. As such, all information, content, and materials available on this site are for general informational purposes only. Please review our Editorial Standards for more info.
House Hacking Calculation Formula
Our house hacking calculator formula examines the net housing cost if you are to house hack. The formula is below:
Net Housing Cost = (Mortgage Payment1 + Property Taxes2 + Insurance3 + Other Expenses4) – Tenant Income5
1. Mortgage Payment – This is the total monthly mortgage payment.
2. Property Taxes – This is the total monthly property tax payments.
3. Insurance – This is the total monthly insurance payments.
4. Other Expenses – This is any other monthly expenses such as HOA, utilities, maintenance, etc.
5. Tenant Income – This is the total monthly amount of rent received from the tenant or multiple tenants.
This calculation calculates the overall net housing cost if you are to house hack. A positive numbers (+) is the amount you would have to pay per month for housing costs. A negative number (-) is the profit you would receive every month from house hacking.
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House Hacking Calculator FAQ
How to Calculate House Hacking With Multiple Tenants?
Calculating the net housing cost with multiple tenants, first requires you to estimate the total monthly rental income from all units. Then, subtract all monthly expenses such as mortgage payments, property taxes, insurance, maintenance, etc. from this income to determine your net housing cost. In our calculator, the “Tenant Income” field would include rent from all tenants.
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How to Can I Ensure Profitability When House Hacking?
To ensure profitability when house hacking, it’s important to accurately calculate your total expenses, including mortgage, taxes, insurance, and maintenance, and compare them against the potential rental income. Additionally, selecting a property in a desirable location with a high demand for rentals can significantly increase your chances of maintaining consistent occupancy and achieving a profitable venture.
