01
Pick the right unit count.
FHA + VA + Conventional all permit 1-4 units as owner-occupied. 2-4 units typically cash-flow better than single-family. 4 units is the FHA ceiling without commercial financing.
House Hacking · the W-2-to-landlord unlock
Buy a duplex.
Live in half. Win.
House hacking is the fastest path from renter to landlord. Buy a 2-4 unit with an owner-occupied loan (FHA 3.5% / VA 0%). Live in one. Tenants in the others cover most of your payment. After 12 months, repeat. This is how 80% of new investors actually start.
· The four moves
Four steps
from offer to passive income.
02
Lock in owner-occupied terms.
FHA: 3.5% down, 580 score. VA: 0% down for eligible vets. Conventional: 5% down on 2-4 units (15% on investor terms). The owner-occ requirement: live there 12+ months.
03
Underwrite with rent income.
Lenders use 75% of market rent on the OTHER units toward your DTI. That's huge. A $1,800/mo rent helps your file by ~$1,350/mo of qualifying income.
04
Plan the year-13 move.
After 12+ months, you can move out and rent your unit too. Your former primary becomes a full investment property — at owner-occupied loan terms. Repeat the move; build a portfolio.
· The scenario
$240K Pittsburgh duplex.
Real numbers.
- Property
- Pittsburgh duplex
- Purchase price
- $240,000
- FHA down (3.5%)
- $8,400
- PHFA K-FIT 5% (forgivable)
- −$11,200
- Estimated cash to close
- ~$3,500
- Loan amount
- $231,600
- Total monthly PITI
- ~$2,050
- Other unit rent
- −$1,400/mo
- Your effective housing cost
- ~$650/mo
$650/mo to live in your own duplex while the other unit pays the rest. Compare to renting the same neighborhood at $1,500+/mo — that's ~$10K/year saved AND you're building equity.
· Watch-outs
Four traps
first-time hackers fall into.
Pitfall 01
Buying a duplex you'd hate to live in.
Year 1 you HAVE to live there. Pick a property + neighborhood you can stand. Skip the dump just because the math pencils.
Pitfall 02
Underestimating landlord work.
Tenants will text you at 11pm about the dishwasher. Either accept it, hire a property manager, or wait until you can do it well. House hacking ≠ passive income on day one.
Pitfall 03
Skipping vacancy + capex reserves.
Rent assumes a tenant. Empty unit + boiler failure same month = the deal that broke a new investor. Reserve 6 months of PITI. Always.
Pitfall 04
Moving out at month 11.
Owner-occupied loan requires 12 months. Move at month 11 and you've technically violated the loan. Wait the year.
Live cheap.
Build equity. Repeat.
Five minutes. We map your file against duplex inventory in your metro and tell you exactly what your effective housing cost looks like.