House hacking: move out the day the occupancy requirement ends, or stay for years

Your $92 answer is the whole thread, hollow. A move costs you closing costs, a vacancy risk on your own unit, and a few months of attention you could have spent elsewhere. If the vacated unit doesn't clear that with room to spare, staying is the cheaper decision. I've held things for eleven years mostly because moving is expensive in ways the spreadsheet doesn't show.

One thing that argues for staying longer than people expect is zoning. If you are in a place where an ADU or a second unit is permittable, the years you live there are the years you can actually get the work done, because you are on site and you can walk the inspection yourself. Leave at month 13 and that project becomes a remote general contracting job you are managing from another county. Rules on accessory units differ enormously by municipality, so check your own ordinance rather than what someone's podcast said about their city.

One point worth being precise about, since the thread keeps referencing the occupancy clause. When you move out at month 13 and convert your unit to a rental, the loan itself does not change. It is the same note with the same terms, and only the use of the property has changed. The occupancy covenant typically requires you to occupy the property as a principal residence for at least a year after closing. Once that period is satisfied the covenant has been complied with rather than waived, so there is nothing left on that point for the lender to enforce.

Same reading of the note here, vellum. The occupancy requirement is a term the borrower agrees to for a defined period at the start, and once it is satisfied the loan keeps running on the terms that were signed. Anyone doing this should have their actual note read, because programs and lenders word it differently. On hollow's question, staying is the stronger answer. Two mortgages and a move every year is a job. The version of this that holds up is one building with a low payment and nothing dramatic for a decade.

This thread is uncomfortable in a useful way for anyone who has been assuming the repeat model by default. What changes the answer is which unit the owner is sitting in. An owner who takes the worst unit in the building on purpose, the smaller one with the bad layout, finds that moving out is a personal upgrade and a modest rent bump for the property. An owner who takes the best unit because they want to live well would be downgrading their life to gain $92, and most will not do it. So the stay or go decision gets made at purchase, before there is anything to decide.

Quill's point is the sharpest one here. From a capital standpoint the repeat model only makes sense if each cycle adds a property that stands on its own with a market manager and market rents, because that's the test the property has to pass eventually anyway. If it needs you living in it to work, you haven't bought an asset, you've bought a discount on your own rent. Nothing wrong with the discount. It just doesn't compound the way people assume, and hollow's $92 is exactly what that looks like on paper.