How to Pay the Same Price for a PMQ and Own 2 Homes in 5 Years: The Path2Own Strategy

How to Pay the Same Price for a PMQ and Own 2 Homes in 5 Years: The Path2Own Strategy

What if you could pay the same monthly amount as a PMQ while building wealth and owning two homes in just five years? It’s possible with Path2Own’s rent-to-own program and a smart strategy called house hacking. Here's how it works and how you can start building your real estate portfolio today.

Step 1 – Rent-to-Own a Duplex with Path2Own

You start by entering a rent-to-own agreement with Path2Own for a duplex. The rent-to-own model allows you to pay lower upfront costs and build savings toward owning the property.

For example, let’s say you enter into a rent-to-own agreement for a $500,000 duplex. With Path2Own, you only need a 2-3% down payment, which is around $15,000 upfront. Your monthly payment for the duplex would be:

• Monthly Rent: $2,800

• Option Payment (Building Your Down Payment): $600

• Total Monthly Payment: $3,400

Here’s the great part: $600 of your monthly payment goes toward building your down payment, so over the 36-month term (3 years), you will have saved up $21,600 for your future home purchase.

Step 2 – Sublet the Other Unit to Start House Hacking

Now, here’s where the strategy really starts to work. While you live in one unit of the duplex, you can rent out the second unit. This is known as house hacking, and it allows you to reduce your living expenses significantly.

Let's say you rent the second unit for $2,000/month. This rent from your tenant will cover part of your monthly payment. The Path2Own program works by adjusting the rent, so you would still pay $4,000 total for both units, plus the monthly option payment of $600. This ensures you’re still building equity while covering most of the property’s costs through rental income.

Here’s the breakdown:

• Your Rent for the Duplex (Unit 1): $2,800

• Rent from Tenant (Unit 2): $2,000

• Path2Own Payment for Both Units: $4,000 (includes your share of the rent from the second unit)

• Monthly Option Payment (Building Your Down Payment): $600

• Total Monthly Payment: $4,600

What You End Up Paying Per Month

After factoring in the tenant’s rent, you’re left with a monthly payment of:

• Total Payment: $4,600

• Less Tenant's Rent: -$2,000

So, your out-of-pocket monthly payment for the duplex is just $2,600

Step 3 – Owning the Duplex for 2 Years

After three years in the rent-to-own agreement, you’ve built up significant savings, and your duplex has appreciated in value. Let’s assume the property has increased by 7% annually. After three years, the duplex is now worth $612,763.

Now, you’ve fully transitioned into ownership, and you’ve been living in your duplex for a total of five years. You’ve used the rental income from your second unit to help cover your costs, and over the years, you’ve accumulated valuable equity.

Step 4 – Refinance and Buy a Second Property in 5 Years

Now that you’ve owned the duplex for five years and built equity, it’s time to refinance. Your property’s value has risen by 7% per year, meaning you now have substantial equity to leverage. After five years, the duplex is worth $701,155.

With this new equity, you can cash-out refinance the duplex and use that money for a down payment on a second property, like a $400,000 home.

Here’s the breakdown:

• New Property Purchase: $400,000 home

• Down Payment (Using Equity from Duplex): $40,000

• Rental Income from Duplex: $2,000/month (from Tenant in Unit 2)

Now, you own two properties. The first duplex is cash-flowing (thanks to the rental income), and you now have a second home under your belt.

Step 5 – Owning Two Homes with Minimal Costs

At this point, your total monthly payments are similar to what you would’ve paid for a PMQ, but now you own two properties.

• Duplex Monthly Payment: The tenant’s rent still covers a portion of your mortgage.

• Second Home Mortgage: Your rental income from the duplex covers part of the mortgage for your new home.

• Cash Flowing Duplex: After refinancing, your duplex is cash-flowing, meaning it’s generating income to help pay down both mortgages.

In just five years, you’ve used house hacking and Path2Own’s rent-to-own program to move from paying rent to owning two properties—and your total cost for both homes is about the same as what you would’ve spent on a PMQ. The difference? You now have two income-generating properties, equity in both, and long-term wealth.

Why This Works: House Hacking + Path2Own

This strategy works because you’re leveraging the power of house hacking (renting out part of your property to cover your costs) combined with the flexibility of Path2Own’s rent-to-own model. You get started with a low down payment and use rental income to build equity while living in your property.

Ready to Own Two Homes in 5 Years?

This isn’t just about paying for a place to live; it’s about creating long-term financial security. By combining house hacking with Path2Own’s rent-to-own program, you can own two homes and build equity in just five years—at the same cost as renting a PMQ.

If you’re ready to learn more about how this strategy works and how Path2Own can help you get started, contact us today to begin your journey to homeownership and wealth-building!