Is House-Hacking a thing in Bellingham, WA?
I don't suspect I will ever stop singing the praises of owning real estate.
Even as it requires more and more creativity and resourcefulness to make it happen in our beloved Bellingham, WA.
"House hacking" is one of those creative ways that I would like to see more people -- eventually my own kids -- engage in.
The concept has been around forever, but the name became popular thanks to the Bigger Pockets podcast and blog.
It's simple: House hacking means using your primary residence to earn rental income, by renting out part of it while you also to live there.
House hacking in Bellingham can take a lot of shapes:
You could live in a simple 2-bedroom home and rent out one bedroom.
You could have a property with both a main house and an accessory dwelling unit (ADU), and you rent out the main house while living in the ADU, or vice versa.
You could own a duplex, fourplex, or 12-plex, and live in one apartment while renting out the others.
If zoning allows for it, you could AirBNB one (or more) of the units while you live there, potentially earning multiples more than doing a long term rental.
Like most of real estate investment, there are a LOT of financial perks that offset the potential downside of having someone share your property.
ESPECIALLY if the alternative is to just keep renting.
If you qualify (for a mortgage) to buy, but don't like the looks of that large monthly payment, consider these benefits of house hacking:
Because you plan to live in / on the property, you qualify for "owner occupied" interest rates on the mortgage -- which are materially lower than non-owner-occupied rates.
You need a much smaller down payment than if it were a straight income property -- think 3% (or in some cases even 0%) versus 20-25%.
Obviously, there is straight rental income to help pay your mortgage and "operating expenses" like utilities, taxes, insurance, and maintenance.
You're also, as an owner versus a renter, on the "real estate equity escalator" and taking advantage of appreciation over time.
Unlike renting, the cost of which is subject to annual increases, the 30-year mortgage -- by far the largest portion of a monthly payment (that also includes taxes and insurance) -- is fixed for 30 years.
You can take advantage of depreciation and write-offs for operating expenses for the portion of the property used as a rental -- this is not allowed for fully owner-occupied residences that aren't producing income.
You're now officially running a rental property business and gaining valuable landlord experience that you can use as you expand your rental holdings in the future.
There are a hundred ways to approach house hacking in Bellingham and Whatcom County.
You don't even have to share part of your actual house -- you can just offer up a piece of land for campers through a site like www.HipCamp.com.Plenty of others have been doing it successfully in and around Bellingham.
Take a look for yourself.
A commitment to keep exploring
The housing-cost-to-income-level in Bellingham grows more concerning every day.
It's not just here, either, but it is perhaps especially noticeable here.
My advice to anyone feeling the pressure -- and something my own family and I are doing on a very regular basis related to continuing to make a living here:
Stay curious!
Keep exploring.Strike up the conversation with others and share ideas.
House hacking is 100% legit and has more ways, strategies, sites, apps, automations, resources, guides, and safeguards than ever to engage in it.
If you're doing it, or have an idea or question about it, let me know!(And if you know any Seniors I can help with their housing situation, referrals for "aging in place" organizers or contractors, a transition to independent living, anything like that, PLEASE reach out.)
