Calculate the net cost of ownership when renting out a portion of your primary residence.
Net monthly cost of housing
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Total monthly housing cost
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Rent collected
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Annual savings vs baseline
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Cash-flow positive?
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How a tenant carries your mortgage
House hacking is the simplest path most people have into real estate: you buy a property you will live in, occupy part of it, and rent the rest. The rent offsets your housing cost, and in good deals it covers the mortgage entirely. The reason it works is financing. An owner-occupied loan lets you buy with as little as 3% to 5% down, while a pure investment property usually demands 20% to 25%. You get investor-grade cash flow on a homebuyer down payment. This calculator answers the practical question that follows: after the rent comes in, what does your housing actually cost each month?
Reading the net cost number
The headline figure is your net monthly cost of housing: every dollar the property costs you, minus the rent you collect. Total cost is the mortgage principal and interest, plus property tax and insurance, plus utilities and maintenance you pay. Subtract rent and you get the net. If that number is positive, the property still costs you something each month, but far less than renting. If it is zero or negative, you are cash-flow positive, meaning your tenant pays your full housing cost and then some. The tool also compares your net cost to what you would otherwise pay in rent, so you can see the true savings rather than just the raw number.
A duplex that drops housing to $1,750
Picture a duplex bought with an FHA loan. The mortgage principal and interest run $2,500 a month, property tax and insurance add $650, and you budget $400 for utilities and maintenance on the part you keep. You live in one unit and rent the other for $1,800. If you were renting a comparable place instead, it would cost you $2,400.
| Line item | Monthly |
|---|---|
| Mortgage principal and interest | $2,500 |
| Property tax and insurance | $650 |
| Utilities and maintenance | $400 |
| Total monthly cost | $3,550 |
| Less rent collected | ($1,800) |
| Net cost of housing | $1,750 |
| Annual savings vs $2,400 rent baseline | $7,800 |
Net housing falls to $1,750 a month, which is $650 a month below the $2,400 you would pay renting. Over a year that is $7,800 you keep, on top of the loan paydown and any appreciation you earn as the owner. That is the quiet power of house hacking: you turn the largest expense in most budgets into a smaller one, and you do it while building equity.
What this calculator leaves out
The net cost here is a clean monthly snapshot, but a few real-world items sit outside it that you should hold in mind. Vacancy is the big one: the tool assumes the rental stays occupied, yet in practice you should pencil in a month or so of empty unit each year and a reserve for turnover. Capital expenses such as a roof, water heater, or HVAC are lumpy and are not captured by a flat maintenance line. On the upside, the rent you collect is taxable income, but you also get to deduct the rental share of mortgage interest, property tax, insurance, repairs, and depreciation against it, which often shelters much of the cash flow. And after the one-year owner-occupancy requirement, you can move out, rent the whole property, and roll into the next house hack, which is how many investors build a portfolio.
Can the projected rent help me qualify for the mortgage?
Often yes, and it is one of the underappreciated advantages of buying a two-to-four-unit property. When you buy a multi-unit home, many lenders will count a portion of the expected market rent from the units you will not occupy as qualifying income, which raises the loan amount you can afford. The exact treatment varies by loan program; conventional and FHA each have their own rules, and lenders typically use a market rent appraisal and apply a vacancy haircut, often counting around 75% of the gross rent. Renting a single room in a single-family home usually does not count toward qualification, so the rent-as-income boost is mostly a multi-unit benefit. Ask your loan officer how they treat projected rent before you assume it into your budget.
Do I pay tax on the rent my roommate or tenant pays?
Yes, rental income is reported on Schedule E, but it is rarely taxed dollar for dollar. You allocate expenses between the personal and rental portions of the home and deduct the rental share, including depreciation on that portion of the structure. In many house hacks the deductions, especially depreciation, offset most or all of the rental income in the early years, so the cash you collect often arrives with little or no current tax. Keep clean records of the split, because depreciation you claim will be recaptured when you eventually sell.
Is renting a single spare room worth it?
It can be, and it is the lowest-friction version of the strategy. Renting one room in a house you already own or are buying does not require a multi-unit property or special financing, and even $800 to $1,000 a month meaningfully cuts your net housing cost. The trade-off is shared living space and less privacy. Run your own numbers in the tool with a lower rent figure; even a modest room rental often turns a stretch budget into a comfortable one.