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4 Cities Where You Can Live for Free in 2025

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January 31, 2025

TLDR: Four best house hacking markets discussed: Fayetteville (AR), Chattanooga (TN), Charlotte (NC), and Indianapolis (IN), all offering lower home prices, decent wages, good job growth, and potential for rental income. Craig Curelop, author of 'The House Hacking Strategy', evaluates these markets.

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In the latest episode of the BiggerPockets Podcast titled "4 Cities Where You Can Live for Free in 2025," hosts Dave Meyer, Craig Curelop, and data analyst Austin Wolff discuss the beneficial strategy of house hacking. House hacking refers to purchasing a multi-unit property where you rent out a part of the property to eliminate or significantly lower your living expenses. This strategy not only helps individuals accumulate savings but also boosts their journey towards financial freedom.

What is House Hacking?

House hacking involves buying a property, often with a low down payment (approximately 3-5%), and renting out part of it to offset mortgage payments. The idea is to capitalize on the income from tenants to live for free or at a much-reduced cost.

Key Benefits of House Hacking:

  • Reduce or Eliminate Monthly Housing Costs: Renting out a portion of your living space can result in substantial savings.
  • Accelerate Investment Opportunities: More savings can lead to quicker investments in real estate.
  • Achieve Financial Freedom: Relying less on a traditional mortgage promotes faster paths to wealth.

Why Consider Moving for House Hacking?

Most individuals often assume they must house hack where they currently live. However, the podcast highlights that certain cities may be far more favorable because housing costs and market conditions can vary significantly. As home prices rise in urban areas, alternative markets offer opportunities not just for investment but also for quality living.

Key Locations for House Hacking in 2025

1. Fayetteville, Arkansas

  • Median Home Price: Below the national average.
  • Median Rent: Approximately $1,600.
  • Job and Wage Growth: Strong growth in white-collar jobs primarily due to the university.
  • Lifestyle: Known as a mountain biking hub, Fayetteville presents an appealing environment for those who enjoy outdoor activities with a vibrant community.

2. Chattanooga, Tennessee

  • Median Home Price: About $300,000.
  • Median Rent: Nearly $1,500.
  • Strengths: The city boasts a city-wide smart grid, attracting startups and offering exceptionally fast internet. Despite job growth mainly in manufacturing, industries are gradually diversifying.
  • Concerns: Hot summers and cold winters may deter some potential residents.

3. Charlotte, North Carolina

  • Median Home Price: Around $370,000, but higher median rent at about $1,700.
  • Economic Environment: Home to many finance and tech jobs, Charlotte is poised for growth with a notably better job market and a significant talent pool due to its educational institutions.
  • Overall Appeal: Highly rated for job availability and quality of life.

4. Indianapolis, Indiana

  • Median Home Price: Approximately $275,000, the most affordable of the four discussed.
  • Median Rent: About $1,500, yielding a healthy rent-to-price ratio of 0.54%.
  • Job Market: Strong job growth, particularly in pharma and manufacturing, with a business-friendly environment.
  • User-Friendly Real Estate: There are many opportunities for house hackers looking to do renovations or live-in flip-type investments.

Practical Steps to Start House Hacking

  1. Research and Find an Investor-Friendly Agent: Partner with an agent experienced in house hacking who understands local market dynamics.
  2. Evaluate Potential Markets: Visit selected cities to gauge lifestyle compatibility and explore the overall environment before making any commitments.
  3. Understand the Local Economy: Research wage growth, job market statistics, and rental yields in the area to assess long-term viability.

Conclusion

House hacking remains an instrumental strategy for those looking to minimize costs and build wealth through real estate. The episode emphasizes the importance of selecting the right market and combining economic fundamentals with personal preferences for a successful house hacking endeavor. Cities like Fayetteville, Chattanooga, Charlotte, and Indianapolis offer promising opportunities for prospective house hackers looking to make a move in 2025.

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