Wiser House-Hacking: My Experience Living Without Paying Rent or a Mortgage

In April of 2021, I closed on my first property, a 4 bedroom, 3 bathroom single-family home in Saint Petersburg, Florida.

I detail in another article exactly how I found the property, what renovations I made to it, and how I eventually rented the property. That article is great if you are interested in an analysis of the deal, as well as a before and after snapshot of the numbers I ran before purchasing it and numbers I realized after everything was all said and done.

I eventually ended up living in this property, as well as renting out the rooms. What is now ubiquitously referred to in the real estate investing world as “house-hacking.”

I write an article explaining why house-hacking is a wise choice for a first-time investor here.

I’ve explained what house-hacking is in a nutshell and why I think it is wise to house-hack your first home or rental property. While you live without costs, you might even make a little bit of income in the process. While others pay off your loan, you get to save for your next rental.

However, I never talked about how I’ve been getting on with house-hacking personally. Many people say it’s not for them. They like their privacy. And no amount of money will convince them to share their living space with another. 

Whatever the reason may be, I’ll share some pros and cons of house-hacking that applies to my personal experience. I’ve been house-hacking my primary residence for over a year now. I’ve had 5 tenants since I began renting the other rooms in my house. As I mentioned, I live in a 4-bed 3-bath 2,250 square foot home. We share the common spaces. I have my own bathroom, as does another roommate, while 2 roommates share a bath. The home sits on a 11,000 square foot lot. There is ample space for everyone. I wont go into the details of the purchase but you can find information on that here.

To keep a long post short: I have so far had only a good experience house-hacking. 

The most important thing I can say about living with others is to carefully screen them and to make the rules clear and have everything in writing. Make sure to sign a contract. Not one that you wrote yourself, but legal agreements that you can find online. There are ample sources out there for you to find them.

When I first posted the rooms online, I listed them for $625, $725, and $850 for the two rooms with the shared bath and the room with the private bath, respectively. I received dozens of requests per day, and hundreds before the week was over. After speaking to some fellow landlords, they told me I was underpricing the rent and recommended that I increase the rent. Despite the increase to $725, $825 (now $850), and $950, I was still receiving dozens of requests per week. I was very careful to screen the people I eventually chose to let live with me.

The benefits of the rent increases are twofold: more important than just higher rent, the quality of the tenant comes with the higher price. The markup of rent automatically weeds out a certain class of tenant, leaving (for the most part) responsible people who are able to afford it.

I’ve written before about what I think constitutes being a great landlord. I have just three simple rules for the house: 1) pay rent on time, 2) no loud noises at inappropriate hours, and 3) keep the common spaces clean. There are a few other things, such as no guest not on the lease is allowed to stay for longer than 7 consecutive days (to avoid tenants I did not agree to living there) and no subletting. All of which are important to me. I make sure to hash all these details out before we sign the lease.

I found a roommate agreement template online and rewrote some of the clauses to match my situation more closely. I then highlighted all the main bits and made sure that the tenants understood them before we signed. I made sure to read through everything highlighted when we sat ready to do the signing.

I don’t implement too many rules about what people can or cannot do while living in the home because I feel as though that makes for a more confrontational living environment and therefore makes tenants leave. I’m an easygoing guy so long as rent is paid on time and no one leaves the common areas in a way that makes it appear as though a train ran through them. I’m happy with people coming over so long as they are respectful of the home.

I should mention that out of the hundreds of people who requested to live in the home, I interviewed only a handful of them. I wrote off a lot of people based on the lifestyles I saw on their social media profiles. So one lesson here is to be very careful and not rush into signing any agreements with anyone until you are absolutely sure they will respect the rules you laid out for them and that you will be able to get along with them.

I’ve done background checks on everyone who I chose to let live in the house. Whether or not you do this depends on you, though I highly recommend it. People are great at impressing you in phone calls or interviews. Usually, people with something to hide don’t just come out and tell you what they don’t want you to hear. I generally talk this through before I do a background check and give the potential-tenant an opportunity to tell me what I will find out anyway so that it saves both of us time and money.

I’ll stick to recommending house-hacking to anyone interested in real estate. I don’t even believe it is only for first time investors. I think even seasoned investors can benefit from it. And it doesn’t necessarily have to be sharing your rooms—you can get a duplex or a triplex, live in one unit, and rent out the others.

I’ll continue to house-hack to accelerate my goal of buying more properties and building my business and my portfolio. If you have any questions regarding house hacking, feel free to comment on this article with questions or with your own personal experience house hacking.