How to get Started in Real Estate Investing with High Prices and Elevated Interest Rates: Your Guide to House Hacking in 2026



As mortgage rates stay elevated and home prices haven't receded, many would‑be investors feel stuck on the sidelines. If you’ve been dreaming about buying investment property but worry about cash flow or a large down payment, house hacking could be the perfect solution. House hacking is buying a primary residence with the intention of using it as an investment property at some point in the near future. . With a new year just around the corner, let’s explore why house hacking is such a great goal for 2026 and the different ways you can make it happen.

Why House Hacking Makes Sense Now

Boise Turnkey has helped hundreds of people start their investing journey through House hacking- it's nothing new. As a matter of fact, we firmly believe buying a small multifamily property- a duplex, triples or fourplex, and living in one of the units is, without a doubt, the best way to get started.

House hacking has become increasingly popular because it tackles two major challenges: high housing costs and the difficulty of saving for a separate rental property. Rising mortgage rates and home prices have prompted many buyers to seek creative ways to afford a home. By renting out a portion of your primary residence, you generate income to cover your mortgage while living in a property you own. House hacking helps reduce that burden of a high mortgage payment so you can build wealth and reach financial freedom sooner.

Another advantage is financing: owner‑occupied loans such as conventional, FHA and VA offer much lower down payments than typical investment loans. FHA loans require just 3.5% down for multifamily properties up to four units, and VA loans offer 0% down for eligible veterans. With a conventional loan, you can purchase up to four units with 5% down. However, these programs require that you intend to live in the property for at least 12 months before converting it to a pure rental-perfect for a house hacking plan.

How House Hacking Works

Rental income helps cover mortgage payments, property taxes, insurance and other expenses. There are even tax benefits to this strategy- you can deduct a proportional share of mortgage interest, property taxes, insurance and maintenance costs. You can also depreciate the rental portion over 27.5 years, reducing taxable income even as your property appreciates.

Because you’re occupying the property, you also keep access to homeowner benefits like the mortgage interest deduction. If you decide to sell later, you likely would qualify to waive the capital gains on that property as well. In short, house hacking blends the tax perks of both homeownership and real estate investing.

Five House‑Hacking Strategies for 2026

House hacking isn’t one‑size‑fits‑all. Here are five approaches you can consider, along with some Boise‑specific insights:

1. The Classic Duplex or Triplex

Buy a small multifamily property (two to four units), live in one unit and rent out the rest. Because properties with four or fewer units qualify for residential financing, you get better rates and smaller down payments than commercial loans. This approach also offers built‑in protection against vacancy because multiple income streams help cover the mortgage. In Boise, duplexes and triplexes are in high demand, but we have been able to get excellent deals for many of our clients on these properties all over the valley.

2. Rent a Room (or Three) in a Single‑Family Home

If multifamily properties are scarce, house hacking can be as simple as renting out spare bedrooms in your home. Renting a bedroom or two can cover half or more of your mortgage.You’ll share common areas, but for first‑time investors, this is a low‑cash entry point.

3. Build or Convert an Accessory Dwelling Unit (ADU)

Accessory Dwelling Units—granny flats, in‑law suites or backyard cottages—are increasingly popular, especially since Boise basically rubber stamps approvals for these income producing units.  In Boise’s landlord‑friendly market (vacancy rates under 2%,, an ADU can generate steady cash flow and add substantial value to your property.

4. Short‑Term Rental Suite

Converting a basement or spare bedroom to an Airbnb can yield plenty of long‑term rental income and no long term committment. This works well in all over Boise.

5. The Live-In BRRRR.

For the handy investor, buying a fixer‑upper at a discount, living in it during renovations, then keeping it as a rental or selling after two years can yield substantial returns. When you live in a property for at least two out of five years, you can exclude up to $250,000 ($500,000 for couples) of capital gains when you sell. This strategy is a killer way to scale and build capital- you offset your own living expenses while potentially waiving your capital gains along the way as well. Heck, you can combine this strategy with any of the other strategies above and make serious progress over just a few years.

The Long‑Term Payoff

House hacking isn’t just about surviving today’s high‑rate environment; it’s about building long‑term wealth. Boise remains a landlord‑friendly market with vacancy rates below 2%. Over time, your tenants help pay down the mortgage while you benefit from appreciation and principal reduction. Even modest 3% annual appreciation can dramatically increase equity over five years. Meanwhile, tax deductions—mortgage interest, property taxes, depreciation and more—help you keep more of your rental income.

Make House Hacking Your 2026 Resolution

If you’ve been waiting for the “perfect” time to invest in real estate, you'll be on the sidelines for the rest of your life. House hacking offers a low‑cash, lower‑risk way to break into property ownership while still enjoying the comforts of home. It’s a practical strategy whether you’re eyeing a duplex in Boise, renting rooms in Meridian or adding an ADU in Nampa. With the right property and a solid plan, you can cover your housing costs, build equity and set yourself up for long‑term success in Idaho’s landlord‑friendly market.

Ready to explore your options? Boise TurnKey is here to guide you through financing, property selection, tenant management and tax considerations. Let’s make 2026 the year you launch your real‑estate investing journey—one door at a time.

Happy Investing!