Housing is typically the largest single expense in any household budget. By eliminating or drastically reducing this cost, you unlock significant cash flow that can be redirected straight into your investment portfolio. This is the foundation of house hacking.
The strategy involves purchasing a primary residential property—usually a multi-family building like a duplex or triplex—living in one unit, and renting out the remaining spaces. The rental income pays down your mortgage, leaving you with minimal or zero net housing costs while you build equity.
Over time, as property values appreciate and loan balances decrease, you can repeat the process. House hacking accelerates your timeline to Financial Independence (FIRE) by addressing the single largest budget drag.