Live in one unit · rent the rest
Buy a 2–4 unit property, live in one unit, and rent the others. See what it really costs you to live there, with owner-occupied financing, mortgage insurance, and property tax from the actual millage, including the partial homestead exemption on your own unit.
The building and what it costs to buy.
Market rent for every unit, including yours. Pick the unit you'll live in.
Your own unit's rent isn't income while you live there, but it counts when you move out, and FHA's 3–4 unit test uses it.
Living in the building gets you owner-occupied terms: less down and lower rates than an investment loan.
Use the values and millage from the township or city assessor/treasurer. The tax is calculated, not guessed.
Michigan: the year you buy, the bill is based on the seller's taxable value. The next year taxable value "uncaps" to the SEV (about 50% of market value), so budget on Year 2+. A partial Principal Residence Exemption covers only the unit you live in: by default, 1 ÷ number of units (the state measures it by your unit's share of taxable value, so ask the assessor if units differ in size). You must file the PRE affidavit; it removes up to 18 school operating mills on that share. 45 mills is only an example. Outside Michigan: set school mills to 0, enter your assessed value, and use your county's ratio.
What the building costs to run, beyond the mortgage, tax and insurance.
Maintenance and CapEx are budgeted on all units' rent, since the whole building wears. Management is 0 if you manage it yourself; it applies to rent actually collected.
| Year 1 | Year 2+ | |
|---|---|---|
| Principal & interest | $0 | $0 |
| Mortgage insurance | $0 | $0 |
| Property tax | $0 | $0 |
| Insurance + HOA | $0 | $0 |
| Maintenance, CapEx, mgmt, utilities | $0 | $0 |
| Less: rent collected from other units | $0 | $0 |
| Your net housing cost | $0 | $0 |
| vs. what you pay now | $0 | $0 |
Year 1 uses the seller's current taxable value; Year 2+ uses the uncapped SEV. A negative net cost means the other units pay all your housing and then some.
The ROI Calculator gets the price, all units' rent, the no-PRE tax and your costs. It doesn't model FHA/PMI insurance, so subtract that from its cash flow.
One thing goes wrong at a time. Check you could still afford to live there, and whether it would still pay if you moved out.
| Scenario | Your net cost (Year 2+) | vs. now | Move-out cash flow |
|---|
We'll walk through the few fields that matter most for an accurate result. You can leave at any time.