House Hacking Strategy in Houston, TX
Neighborhood: Heights

Business Case: House Hacking on Single Family Home

This single-family home (SFH) was built 2007 with 3-bedrooms, 3.5-bathrooms and is located in the Heights in Houston, TX. As each bedroom has its own bathroom, this rental asset typically attracts young professionals in their 20s who room together to save on rent vs. renting apartments. The tenant base in this area is Class A. Renters do turn over every year or two. The asset was not renovated over the hold period.

For this Business case, we have used actuals numbers, which are not optimized as the house hack was based on only renting one bedroom out of the two rentable bedrooms. Owner rent was included as if he was renting out a room.

Property Overview

Location – Heights in Houston, TX
Strategy – House Hacking
Date Acquired – March 2008
Date Resold – August 2014
The real estate market was increasing during the hold period.

Investment Metrics

(Net of Fees)​

Acquisition Price – $265k
Loan Type – Conventional 20% down @ 4.75%
Resale Price – $385k
Hold Time – 6yrs 5mos
Equity Multiple 3.98x
Leveraged IRR (actual) 32%
Av. Yearly Appreciation 6.9%
Av. Vacancy 5%
Av. CAPEX & Maintenance 1%

Ben Plouvier

Manging Broker, HNB Realty
10497 Town and Country Way, Ste 700,
Houston, TX, 77024
Office: (281) 201-3710 I Mobile: (713) 410-0709

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