House Hacking Calculator
See how renting out rooms or units offsets your mortgage, and how much you save versus renting elsewhere.
Want to understand the concept, not just the number? Read The Real Estate Tax Guide and more below.
How it's calculated
House hacking is one of the fastest ways to cut your biggest expense. You buy a property, live in part of it, and rent out the rest, a spare room, a basement unit, or the other side of a duplex. The rent your tenants pay offsets your mortgage, so you live for far less than either renting or owning outright would cost.
The math is simple. Take your total monthly payment and subtract the rent you collect. Take the default. A 2,800 dollar payment with 2,000 dollars of rent collected leaves a net housing cost of just 800 dollars a month. Compare that to the 1,500 dollars you would pay to rent a comparable place, and you are saving 700 dollars a month, or 8,400 dollars a year, while building equity in a property you own.
The strategy works especially well for a first property, since owner-occupants can buy with a low down payment, sometimes 3.5 percent with an FHA loan, on a two-to-four-unit building. Living alongside tenants is the trade-off, and the cash view here leaves out maintenance, vacancy, and the tax rules for the rented portion, which are real. But used well, house hacking can nearly eliminate your housing cost and jump-start a real estate portfolio. Enter your numbers to see the net cost and the savings.
Assumptions
- Net housing cost is your total payment minus the rent you collect. Savings is what you would have paid to rent, minus that net cost.
- This is the cash view. It ignores maintenance, vacancy, the tax treatment of the rented portion, and the equity you build, which all add to the real benefit.
Last updated: 2026-08-08
These assumptions follow our general methodology.
Frequently asked questions
What is house hacking?
It is buying a home, living in part of it, and renting out the rest so the rental income covers much or all of your mortgage. Common forms are renting spare bedrooms, a basement apartment, or living in one unit of a small multi-family building.
How much can house hacking save?
It depends on the rent you collect versus your payment, but many house hackers cut their housing cost by half or more, and some live for free or even profit. This calculator shows your net cost and the savings versus renting for your numbers.
Can I buy a house hack with a low down payment?
Often yes. Because you live there, you can use owner-occupant loans like FHA, sometimes with as little as 3.5 percent down, on properties up to four units. That low entry cost is a big part of why house hacking is popular with first-time buyers.
What are the downsides of house hacking?
You live near your tenants and take on a landlord role, with maintenance, vacancy, and turnover to manage. There are also tax rules for the rented portion. The financial upside is large, but it is not passive, so weigh the lifestyle trade-off.