Does having roommates count as house hacking or is that just having roommates

The screening difference is what separates them for me, juniper. On a separate unit I'm checking whether someone pays rent and takes care of a space. On a room I'm also checking whether I can live with them, and there's no test for that. I've read a lot about tenant screening this year and none of it tells you how someone behaves in a shared kitchen at 11pm.

On the lender question, the general pattern is that income from a self-contained rental unit is easier for an underwriter to use than income from a bedroom in the house you occupy, because the unit has market rent evidence and often a lease. Room income frequently doesn't count toward qualifying at all. That varies by program and by lender, so get it in writing from whoever you're applying with before you build a plan on it.

I did rooms for two years before I bought anything with separate doors. The money was better than people admit. Three bedrooms at $650 each in a house where my payment was $1,720 meant I was living free and change, which no duplex in my market would have done.

What broke was me. Turnover in rooms runs constantly, every departure is a whole re-advertise and re-screen, and I was doing it from my own living room. I'd call it the same strategy in the sense that rent offsets your payment. The labor per dollar is not comparable.

thicket's labor point is the one I keep circling. I'm slow on decisions and I want to know what I'm signing up for over five years, not one. Rooms look like a job that never ends, and a duplex looks like a job that shows up twice a year.

Small multifamily here and I'd put them in different categories, though the poll only lets me pick one.

The reason is what you own at the end. A duplex with two legal units is a rentable asset whether or not you live there. A three bedroom house with roommates reverts to a three bedroom house the day you leave, and the income disappears with you unless the next owner wants roommates too. That matters when you go to refinance or sell, because appraisers look at the unit count, not at how many people were paying you.

Rooms are a fine way to survive a payment for two years. They're not a way to build something that keeps working after you move.

Coming from the build side, the one thing that can turn a room rental into the other category is a wall, a door, and a second kitchen, and that's where people get hurt. A basement with 6'8" ceilings, one egress window, and shared mechanicals is not going to pass as a separate unit in most jurisdictions no matter how nicely you finish it. Requirements for egress, ceiling height, and separate entrances are set locally and differ a lot, so pull your own code before you price anything.

juniper, if you buy the three bedroom, buy one where a legal conversion is plausible later. Then the rooms are the interim answer and the unit is the real one.