I am going to be blunt here, so stick with me because I have a direct stake in house hacking. The truth of the matter is that house hacking is getting more difficult for a variety of reasons. Now, that doesn’t mean it won’t become of value again but from my perspective, it’s tough for many people due to circumstances that are beyond the control of many.

Let’s begin by explaining what house hacking is. Simply, it’s buying a property and renting out space to pay down your part of the mortgage. In Chicago, I have worked with many clients that have bought multi-units; so they live in one, rent out the others. Some are more involved and do a variety of strategies, from BRRRR (Buy, Rehab, Rent, Refinance, Repeat) to 1% rules (ensuring that rent is at least one percent of the purchase price). There are several other strategies but at the end of the day the goal is to make money, generate equity, and then cash out one day. Some take on a few properties, some take on many, and some build some really crazy portfolios.

I have house hacked before and it was nice. Some ask why I didn’t keep going with it and that’s because I know the amount of work it takes. Many started househacking between 2020 and 2024. Now, if you did, good for you! It’s still great. However, many were left stuck at the refinancing part. In the easiest way to explain a refinance, it’s like buying the house from yourself. It gets reappraised and a new loan is formed; thus, you either can have your lending rate adjusted, cash out some money, or just have the terms changed. If you are going into a lower rate, it’s usually pretty great! Or maybe a close rate but you added value so it’s good, too. The hard part is people that had really low, once in a lifetime rates, and then ballooned up to rates that they couldn’t afford the new terms.

Rates have since stabilized but the new norm is higher than it was during the push for properties. Many younger or newer investors aren’t usually prepared for some of the negative things that can occur as well. A few include:

• Increases in property tax.
• Tenants that don’t pay, damage property, mount legal fees, and are liabilities.
• Unplanned property expenses (that roof that you thought was okay really isn’t).
• Local legal adjustments that make things harder on landlords.
• Other personal items that come up that take you away from the property.

Okay, so now I probably crushed a few people’s dreams of quitting their day job and being a fulltime (and very wealthy) landlord. I am not here to crush the dreams you have though but actually the opposite. I am here to make sure you achieve your dreams and if something isn’t for you, to not steer you down that path.

If you can stomach the above (and more but if you are still here, sounds like you’re in this) you may be a good candidate for house hacking. The first thing is to realize it takes time. You will need to learn and apply what you learn. The strongest thing you can do is stay connected to an agent like me because you need to know how the market is moving. Many just want to buy one or two places and make a little extra money, generate equity, and decide if they want to do this into the future (many stop at a few properties).

The most important things to remember for your first property is:

• You will need to make some concessions in where/how you live for the first properties.
• It’s a business…treat it as such.
• You’re not a charity but don’t be greedy.
• This isn’t for everyone.
• You will learn…all the time. Even if you keep doing this and think you got this down, you will keep learning!

House hacking is unique to every person depending on past experience, expectations, risk tolerance, and more. Never compare yourself to another’s journey when it comes to investing, house hacking, or buying a home.

So, should you house hack? If you read through everything above and are still excited, then let’s go! It does have a lot of value and many find it very self rewarding! Plus, wouldn’t you like to get paid rent rather than have to pay it?

If you’re ready to start a search, you may use my exclusive search tool, Zenlist. This will allow you to view off market listings and not be bombarded with adveritisments or agents trying to get you to buy like on Zillow or Redfin.