$700,000
SingleFamily
vs
ThreeFamily
15-Year Mortgage · 6% Rate · Full Analysis
$3,500$3,500OWNER
$1,200,000
Mortgage & Payment Structure
15-Year Fixed · 6% Rate · 20% Down · Bi-Weekly Payment Strategy
Single Family
$700,000 Purchase · $140,000 Down (20%)
Loan Amount$560,000
Monthly Payment (P&I)$4,728
Bi-Weekly Payment$2,364
Total Interest (standard)$291,040
Interest Savings Bi-Weekly+$26,040
Monthly Cost to Owner$4,728
3-Family + Rental Power
$1,200,000 Purchase · $240,000 Down (20%)
Loan Amount$960,000
Monthly Payment (P&I)$8,105
Bi-Weekly Payment$4,053
Gross Rent (2 x $3,500)+$7,000/mo
75% Qualifying Rent (Bank)$5,250 credited
Interest Savings Bi-Weekly+$44,000
Net Monthly Cost to Owner ✓ WIN
$1,455/mo
vs $4,728 single family · Save $3,273 every month
Bank Qualifying Power: The 75% Rule
Lenders count 75% of in-place rents toward your qualifying income
Monthly Gross Rent
$7,000
2 units x $3,500
75% Qualifying Amount
$5,250
Added to your income
Annual Income Credit
$63,000
Boosts buying power
A buyer earning $120K/year normally qualifies for ~$500K. With 2 units at $7,000/mo, the bank counts $5,250 as additional income — effectively adding $63,000 to your qualifying income and enabling the $960K loan at standard DTI ratios.
15-Year Appreciation & Wealth
Single Family: 4.5%/yr avg · Multi-Family: 5.2%/yr avg · Boston Metro
Property Value — 15 Year Trajectory
$3.0M$2.2M$1.6M$1.1M$700KNowYr 3Yr 6Yr 9Yr 12Yr 15~$2.56M~$1.37M3-Family (5.2%/yr)Single Family (4.5%/yr)Single Family — 15-Year Wealth
4.5% avg annual appreciation
Value at Year 15~$1,370,000
Appreciation Gain+$670,000
Mortgage Paid Down+$560,000
Total Paid to Own (15yr)-$851,040
Net Worth Created~$1,230,000
3-Family — 15-Year Wealth ✓
5.2% avg annual appreciation
Value at Year 15~$2,560,000
Appreciation Gain+$1,360,000
Rent Collected (15yr, +3%/yr)+$1,352,000
Total Paid to Own (15yr)-$261,900
Net Worth Created~$3,410,000
Tax Advantages
Investment property deductions significantly favor the 3-family · Est. 28% bracket
| Deduction | Single Family | 3-Family | Annual Advantage |
|---|---|---|---|
| Mortgage Interest (invest. portion) | $0 | ~$38,400/yr | +$38,400 |
| Depreciation (27.5yr schedule) | $0 | ~$21,800/yr | +$21,800 |
| Property Tax (invest. portion) | ~$14,000 | ~$28,000 | +$14,000 |
| Repairs & Maintenance | $0 | ~$9,000/yr | +$9,000 |
| Insurance (invest. portion) | $0 | ~$2,400/yr | +$2,400 |
| Total Annual Deductions | ~$14,000 | ~$105,600 | +$91,600/yr |
| Est. Tax Savings (28%) | ~$3,920/yr | ~$29,568/yr | +$25,648/yr |
The Exit Strategy
The moment you move out, the 3-family pays for your single family
Phase 2: 3-Family Funds Your Dream Home
YEARS 1–7
Owner-occupy Unit 1. Pay only $1,455/mo net. Save $3,273/month vs single family while building equity rapidly.
YEAR 7 CHECKPOINT
3-Family worth ~$1.73M. Equity: ~$950,000. Refi / HELOC options open. Loan balance ~$540K.
MOVE OUT & RENT ALL 3
At 3% annual rent growth, each unit ~$4,300/mo. Gross rents: $12,900/mo. Mortgage: $8,105. Net cash flow: +$4,795/mo profit.
BUY YOUR SINGLE FAMILY
$4,795/mo cash flow services a $700,000+ mortgage. Your 3-family buys your single family for you.
