House hacking a duplex: real numbers walkthrough
House hacking works when the math works. Here's how to actually run it.
Scenario
Priya earns $85,000/year and pays $1,600/month in rent. She has $35,000 saved and a 730 credit score. She's found a duplex listed at $320,000. Unit B is currently rented at $1,350/month on a month-to-month lease. Her PITI at FHA financing would be approximately $2,400/month. After rent from Unit B, her net housing cost would be around $1,050 — $550 less than she currently pays in rent. The numbers look good. But she wants to stress-test them before committing.
Monthly numbers at full occupancy
- PITI (mortgage + taxes + insurance): ~$2,400
- Unit B rent: $1,350
- Net housing cost: ~$1,050/month
- Savings vs current rent: $550/month
- Annual savings: $6,600
Stress test at vacancy
- If Unit B sits empty: full $2,400 is on Priya
- She needs 2+ months of reserves for this scenario
- At 8% vacancy: ~1 month/year factored in
- Effective annual rent income: $1,350 × 11 = $14,850
- Net annual housing cost: ~$14,000 (~$1,167/month)
Things to consider
- Verify market rents with active listings — is $1,350 accurate for this area and unit size?
- Is the current tenant strong — credit, income, history? You inherit this lease at purchase.
- FHA requires owner-occupancy for at least one year — plan accordingly.
- Do you have reserves to cover both units' expenses during a vacancy?
- Are you emotionally prepared to be a landlord to someone who lives next door?
- What does the property need in repairs near-term — factor that into your cash position.
BRIK takeaway
House hacking is one of the most powerful first moves in real estate — but only when the numbers actually work at realistic assumptions. Model it at 90% occupancy, not 100%. Know your tenant. Have your reserves. And make sure the lifestyle trade-off of shared-building living is one you can genuinely live with.