I live in a M-HCOL city and am considering buying a house, and renting out extra rooms to my friends. I'm fairly certain I could find reliable friends to move in and pay, but I only want to do this if I find something that is a definitely financial win. I'm having trouble figuring out exactly how to do that calculation.
What I think it would be roughly is that it is worth it if the following equation is true (t is the number of months I live in the house):
({rent paid by friends} * {room vacancy %} * t) + {rent I would have paid} * t + {how much I sell for}
>
{opportunity cost of money not in stock market} + {closing costs on both ends} + {cost to furnish} + {money left on mortgage} + {down payment} + ({mortgage payment} + {property taxes} + {avg monthly upkeep}) * t
Am I missing anything here? This is all very new to me. I am also having trouble figuring out how much the misc closing costs and realtor fees would be, as well as the avg monthly upkeep. I wouldn't need PMI since I could save up for a 20% down payment on a 400k house, but I feel like I'm missing something else.
Any help greatly appreciated