How I Bought My First Property Through House Hacking

My first property is awesome. I could say that it is by far my best property out of all the properties in my portfolio. I bought it way back in 2018 when I was 22 years old and was just getting started with Real Estate.

I was fresh out of college, and I’ve always been a busybody, so I was reading a bunch of books on different topics. I came upon The Beginners Guide to Investing in Real Estate by Brandon Turner and thought, “I wanna buy a house.” I remember I was at my apartment at that time, and I decided that I didn’t want to pay rent anymore. It wasn’t because I didn’t have the ability to pay rent, but I just felt like my money wasn’t being put to good use. My grandmother at that time was also looking to move apartments, so we decided to live in the same apartment and split the cost. I sold everything in my previous apartment – from couches, furniture, everything. I moved in with my grandmother, kept saving my rent money for a good year, and went through the preapproval process.

Around the same time, I saw on social media that there was a first-time home buyers’ class that was coming up in my area, so I signed up for it out of genuine curiosity of wanting to learn. When I got into that program, I found out that everybody was there for something specific. Apparently, this class was a prerequisite to getting down payment assistance, so they had people up there in the class talking about DPA. I was like, “What, there’s free money out here? Do I qualify?” Come to find out, I DID qualify, and the process was really quick for me. I already had good credit, I didn’t have a whole lot of debt, I paid off my car loan already, and had ZERO liabilities.

I was able to get past that program. It was a 3-day class at the local library and that’s all it took. They gave me a list of Loan Officers and I just picked one and talked to her. She said I was eligible for down payment assistance, and so I started looking for houses. The class was in October, and by April I had already found my first house.

It was amazing. I even came into closing with just $4,000. I got a duplex that didn’t need repairs. It was occupied, and I inherited awesome tenants. Just picture the perfect tenants – they took care of the lawn, kept the property clean, and even gave out vegetables coming from their garden.  It was just the best-case scenario. When I got the keys and got into my house, I remember crying and just saying “OH MY GOD, I DID IT!” It was an empty room and an empty unit, but I was crying and saying I can’t believe I did it, and I instantly, I was like “I have to do it again!”.

I bought that property through a strategy called HOUSE HACKING. House hacking is when you buy a property, typically a multi-family property. When you house hack, you get access to owner-occupied financing which is between 3-5% as a down payment. You agree with the bank to occupy the property typically within a year, probably more depending on the loan type. Once you do that, you sign your paperwork, you get your keys, then you move in. The property can either be vacant or occupied, either way, you start collecting a rental income immediately. It is the best hidden secret of real estate because others think we need to have 15-20% down for a down payment.

I think house hacking is the best way to get started in real estate, especially for beginners. I am happy to have gotten into it at a very young age and be able to accumulate the properties that I have at the rate which I have. It is undoubtedly the best way to buy your first property as it can launch you into a lot of other different strategies. You get to have that starting point and that first-hand experience. Right now, I’m still house hacking and will probably do it one more time before switching to another strategy.

Excerpt taken out from Lighting Up Real Estate Podcast by Candle Lockett (2:42 - 9:55). 🔊 Listen to the whole episode here. 

What you’ll learn in this episode:

• What house-hacking is
• Buying properties with tenants vs. buying properties vacant
• How to leverage banks

If you want to get started in Real Estate Investing, I will recommend trying out the house hacking strategy. It’s been proven and tested not only by me but with other fellow investors who also had to start from scratch. Book a coaching call with me and I’ll guide you step-by-step on how to house hack your first property!