House Hacking Shifts to Long-Term Affordability

"With higher rates and prices, house hacking is now a long-term affordability strategy, helping buyers offset costs and build equity rather than generate quick profits.

NEW YORK – House hacking — buying a property and renting part of it to offset the mortgage — was once considered a fast path to growing wealth for first-time home buyers. It allowed first-time buyers to build their home equity and pay off debt more quickly.

Today, it is being used as a long-term affordability strategy, rather than a short-term strategy to earn profits. Kathy Herig, senior vice president of enterprise credit policy at mortgage lender LoanDepot, told Realtor.com, "With today's higher home prices and elevated mortgage rates, it's shifting toward a long-term affordability strategy rather than a quick path to short-term profit."

With mortgage rates above 6%, the days of ultralow rates are gone, and house prices are expected to continue increasing. Realtor.com projects home prices to rise by 2.2% this year..."

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