ChooseFI Logo

016 | House Hacking With Coach Carson

Have you heard of House Hacking? Break the game with this powerful lever of wealth!

Podcast Episode Summary

  • Real estate investing and house hacking with Chad “Coach” Carson.
  • On the path to financial independence, how much of your own budget is going towards housing?
  • After Chad graduated college at Clemson, he got started with real estate investing in his college town.
  • How financial independence and real estate investing have allowed Chad to move his family to Ecuador for about 1.5 years.
  • When they moved to Ecuador they sold most of their possessions and rented out their house for 2 years.
  • When Chad graduated college he kept his expenses extremely low and actually moved into his business partner’s spare bedroom to help save money.
  • This led to his concept of “house hacking” as a way to keep housing expenses down to nearly zero
  • House hacking: buy a multi-family rental unit and live in one unit while you rent out the rest and have them essentially pay for your house payment entirely
  • Easy to become rich by saving the money you’d otherwise be paying for your house and car payments
  • Keep it simple and pay attention to the fundamentals with your financial life
  • How do you get started with real estate? Where do you find a multi-family unit to buy?
  • What to look for: neighborhoods with charm, safe, public transportation nearby
  • Avoid cookie-cutter neighborhoods on the outskirts of town with new construction
  • Chad recommends hiring a real estate agent at the beginning. Have them run searches based on your desired neighborhoods and automatically send you new listings.
  • It is essential to walk the neighborhoods and talk to people to gather intel. Tip: walk with your kids to seem less intimidating and go on a Saturday morning when they are out
  • It’s important to think differently and take that extra step to find great deals. Have to reach out to people and get outside your comfort zone
  • Real estate: The numbers crunching has to come into play at some point. Put together a profile of what makes a good deal upfront
  • Follow the ‘1% rule’: You are looking for the monthly rent to be 1% of the purchase price ($1,000 per month rent = $100,000 house price)
  • Chad was able to pull his equity out and invest in another deal
  • Small investors need to avoid 5 or more unit complex in order to get the most favorable owner-occupied financing
  • Once you have owner-occupied financing, you can move out and keep the favorable financing rates and rent all the units
  • How to get started finding financing if you have no money saved and no contacts?
  • Options: FHA 203k Loan in order to remodel and do a house hack or Fannie Mae Remodeling loan
  • Building relationships with local real estate investors and private lenders
  • Real estate debt snowball to fully own these properties as a path to wealth and financial independence
  • Chad’s personal strategy: 15% of his assets are currently in index funds with a goal of up to 33% and the vast majority of the rest is in real estate, cash, and financing/note investing
  • Chad and his business partner have approximately 90 rental units currently
  • Chad is not interested in growing as large as possible – he wants to find a balance in life and keep it as simple as possible to meet his financial independence goal
  • Hot Seat Questions
  • Favorite life hack: Planning and actually writing it out. Weekly, monthly, yearly
  • Biggest mistake: buying into other people’s goals and getting sloppy with purchasing a lot of properties at the height of the 2007 bubble

Listen to Brad and Jonathan’s thoughts about this episode on Episode 16R

Links from the show:

Books Mentioned in the Show:

Choose FI has partnered with CardRatings for our coverage of credit card products. Choose FI and CardRatings may receive a commission from card issuers. Opinions, reviews, analyses & recommendations are the author’s alone, and have not been reviewed, endorsed or approved by any of these entities. American Express is a ChooseFI advertiser. Disclosures.
More To Explore
You Might Be Interested in...
Something New at ChooseFI harnessed the power of AI to provide in-depth transcripts for all ChooseFI podcast episodes. Each section of the transcript is clickable so you can listen to the podcast at exactly the point you’re looking for

Other episodes
Share This Post