Is It Still Worth It To House Hack In 2025?
With interest rates higher than in previous years, many prospective homeowners are asking: can you still buy real estate and live for less than renting? In this case study, we explore a real house hack in Denver, showing how a young investor successfully reduced his living costs while building long-term wealth.
Meet the Investor
The investor, a 28-year-old W-2 earner from Seattle, Washington, was paying $2,800 per month for a two-bedroom apartment with his girlfriend. Looking to reduce costs, he set realistic goals for his first house hack: lower monthly housing expenses, gain personal space, and start building equity.
Investor Profile
- Age: 28
- Employment: W-2 earner with solid credit
- Financial status: had down payment saved and reserves ready
- Current living costs: $2,800/month for a two-bedroom apartment
- Goals: Reduce housing expenses, own a space near downtown Denver, begin house hacking journey
The Property
The investor purchased a side-by-side duplex in Arvada, just 5–10 minutes from downtown Denver and near Old Town Arvada. Each unit was three bedrooms, one bathroom, with approximately 1,000 square feet, including washer/dryer hookups and off-street parking. The property was rent-ready, requiring no immediate renovations, making it ideal for a first-time house hacker.
Why This Duplex?
- Move-in ready: no major repairs required
- Optimal location near downtown Denver
- Side-by-side layout reduces noise issues compared to up-down units
- Potential for future value-add opportunities
Financing and Deal Structure
The property was purchased for $655,000, appraised slightly higher, and included an $18,000 seller credit. With only $35,000 cash to close, the deal provided leverage and minimized upfront costs. A 30-year fixed mortgage with a 6.375% rate (after a two-one buy-down) ensured manageable monthly payments.
Financial Highlights
- Purchase price: $655,000
- Cash to close: $35,000
- Financing: 30-year fixed, 6.375% after buy-down
- Monthly cost to live in one unit (without roommates): under $2,100
- Projected net cash flow after renting second unit via Section 8: ~$1,000/month
- Cash-on-cash return: ~25%
- Estimated payback period for down payment and closing costs: just over three years
Living Situation and Rental Strategy
By renting out the other unit to a Section 8 tenant, the investor reduced his effective living expenses. Optionally, he could rent out individual rooms to screened tenants, further lowering his personal housing cost to under $500 per month. This flexible approach allows for privacy, cash flow generation, and future scalability.
Key Takeaways
- Goal 1: Reduce personal housing costs — achieved with net cost under $2,100/month
- Goal 2: Build income and equity — cash flow after renting second unit ~$1,000/month
- Option to rent by room or explore Airbnb/midterm rentals for additional income
- Principal reduction acts as forced savings, contributing to long-term equity
- Support system from brokers and lenders helps optimize property management and strategies
Final Thoughts
This case demonstrates that house hacking in 2025 is still highly viable, even with higher interest rates. By carefully selecting a property, structuring financing smartly, and having a clear plan for occupancy and renting, investors can significantly reduce living costs while building wealth. The key is to take action, analyze the numbers conservatively, and maintain flexibility in strategy. For young professionals looking to enter real estate, a well-executed house hack can be a game-changer for both financial security and future growth.