For many first-time buyers, the biggest hurdle is not finding a home. It is affording one. House hacking is a strategy that tackles this problem head on: you buy a small multi-unit property, live in one unit, and rent out the others. The rent helps pay your housing costs. A duplex like 309 & 311 Grace Ave is a classic fit.
How house hacking works
The idea is simple. Instead of paying a mortgage on a home that produces no income, you buy a duplex and move into one side. A tenant moves into the other side and pays rent. That rent goes toward the mortgage, taxes, insurance, and upkeep, so your out-of-pocket housing cost is lower than it would otherwise be.
At Grace Ave, you could live in Unit 309 and rent Unit 311, or the other way around. Each unit is a 2-bedroom, 1-bath layout with its own living area and kitchen, so you and your tenant each have a full, separate home.
A simple framework for the numbers
Here is how to estimate your own savings. Fill in your real figures, not the example ones.
- Estimate your total monthly ownership cost. This includes the mortgage payment, property taxes, insurance, and any mortgage insurance.
- Add a maintenance reserve. Many owners set aside a percentage of rent or a fixed monthly amount for repairs.
- Estimate the rent from the other unit. Use current comparable listings for 2-bed/1-bath units nearby. The offering materials show a pro forma target of $2,400 per unit, but that is a projection, so use a conservative figure.
- Subtract a vacancy allowance. Even good rentals have gaps between tenants.
- Compare. Total ownership cost, minus net rent, equals your effective housing cost.
Then compare that figure to what you would pay to rent a similar home in the area. The gap is your house-hacking benefit.
Financing options to explore
Owner-occupants often qualify for lower down payments than investors. Depending on current lender guidelines, options can include FHA loans with a low down payment and some conventional programs for 2-unit owner-occupied purchases. Lenders also typically count a portion of expected rental income when qualifying you. Programs, limits, and rates change, so speak with a lender for current terms. We will compare financing paths in more detail later in this series.
Living next to your tenant
House hacking is not for everyone, and it helps to be honest about the trade-offs:
- Proximity: You will share a property with your tenant, which can be wonderful or awkward depending on the person.
- Landlord duties: You are responsible for maintenance, rent collection, and following all landlord-tenant laws.
- Fair housing: You must screen applicants using consistent, lawful criteria and treat everyone equally.
- Privacy and boundaries: Clear lease terms and communication help keep the relationship professional.
Many house hackers find the savings worth it, and some use the strategy as a stepping stone: live in the unit for a period, then move out, keep the property as a rental, and repeat the process with another purchase.
Why Grace Avenue works for this strategy
La Habra is close to major employers, schools, and shopping, which supports both owner-occupant and renter demand. The two-bedroom layouts suit a range of households, and in-unit laundry setups add everyday convenience for you and your tenant alike. Because the units are currently vacant, you could also choose which unit to live in and prepare the other one for lease on your timeline.
Run your numbers
The best way to know if house hacking fits your life is to put your real income, savings, and goals into a calculator. Our team can help you walk through the scenarios.
Next step: Calculate Your House-Hacking Savings.
This article is general information and is not financial, mortgage, or legal advice. Loan programs and terms change; confirm details with a licensed lender.