What if your VA home loan could help cover your mortgage in Austin? If you live in one unit and rent the others, house hacking with a duplex to fourplex can be a smart path to stability and long-term equity. You want clear rules, local guidance, and a plan that fits real life and PCS timelines. This guide gives you the essentials to make a confident move in Austin’s market. Let’s dive in.
VA loans for 2–4 units: what to know
VA loans allow you to buy a 1–4 unit property as long as you live in one unit as your primary residence. You can typically finance up to 100% of the purchase price with no mortgage insurance, and the VA funding fee can often be financed unless you are exempt. Review the basics on the VA Home Loan program.
You will generally need to move in within a reasonable time after closing, commonly within about 60 days. The property must meet VA Minimum Property Requirements during the appraisal, which focuses on safety and habitability across all units. Expect repairs to be required if issues are flagged, especially in older properties.
Rental income from the other units can often help you qualify. Lenders may use signed leases or the appraiser’s market rent estimate to count rental income. Policies vary, so confirm early to avoid surprises.
Lender overlays you should expect
Some lenders cap VA deals at 1–2 units, or they may ask for higher credit scores, cash reserves, or a down payment on 3–4 units. Many also have different rules for counting rental income from vacant units. Get quotes and written answers from multiple VA-friendly lenders that regularly close 3–4 unit loans.
Your house-hack game plan
Step 1: Get prepped
- Pull your Certificate of Eligibility and gather standard mortgage docs like pay stubs, W-2s, tax returns, and bank statements.
- Ask lenders about occupancy timing, rental income treatment, reserve requirements, 3–4 unit eligibility, and your funding fee status.
- Work with a VA-friendly agent who understands Austin’s multi-unit options, zoning, and permitting.
Step 2: Shop the right properties
- Confirm the property is legally a duplex, triplex, or fourplex and check its zoning and use with the City of Austin planning and code resources.
- If you plan to explore short-term rentals, review Austin’s STR permitting rules and HOA restrictions before you go under contract.
- Look for solid, functional layouts, safe access to each unit, and separate utility meters when possible.
Step 3: Appraisal and inspections
- The VA appraisal will assess value and enforce Minimum Property Requirements. Be ready to negotiate repairs or plan for delays if fixes are required.
- Order an independent inspection focused on HVAC, roof, plumbing, electrical, and any common areas. For pre-1978 buildings, ask about lead-based paint disclosures.
Step 4: Underwriting rental income
- If units are rented, gather leases and proof of rent collections. If vacant, lenders may use the appraiser’s market rent estimate and apply a vacancy factor.
- VA approval hinges on both your debt-to-income and the VA residual income test. Your lender will calculate both.
Step 5: Close with eyes open
- Expect standard closing costs. The funding fee can usually be financed into the loan unless exempt.
- Allow extra time if repairs, rent docs, or appraisal conditions slow the process.
Austin factors that can make or break the deal
Zoning, use, and STR rules
Austin’s land development code has evolved to allow more “missing middle” housing in many areas, but rules vary by lot and neighborhood. Verify zoning, existing use, and any permits through the City of Austin. Short-term rentals are tightly regulated and require permits in many cases, so confirm whether STRs are allowed for your property and unit type.
Property taxes and exemptions
Travis County property taxes are a major expense. Rates vary by city, county, school district, and special districts. Review assessed values and exemptions with the Travis Central Appraisal District. Owner-occupants often pursue a homestead exemption, but multi-unit eligibility depends on use and local interpretation. Speak with TCAD or a tax professional for guidance.
Rents and demand
Rents and vacancy rates vary by neighborhood, unit mix, and proximity to jobs and amenities. To benchmark rents, you can review the HUD fair market rents tool and then refine using recent local listings and property managers. Keep assumptions conservative to protect your cash flow.
Landlord-tenant rules and notices
Texas landlord-tenant law sets timelines and responsibilities for deposits, repairs, notices, and evictions. Review the Texas Property Code through the state’s official site at the Texas Statutes portal. Austin may also have local ordinances you must follow. Use clear leases and document repair requests and responses.
Utilities and insurance
Separate utility meters per unit make rent and underwriting easier. Shared utilities require clear lease language. Insurance for 2–4 unit properties is usually higher than for single-family homes, so shop for policies that cover an owner-occupied small multifamily.
Run the numbers with a simple pro forma
Build a conservative pro forma before you write offers. Gather:
- Income: market rent for each unit, expected parking or storage income.
- Expenses: property taxes, insurance, routine maintenance, management fees, utilities you will pay, and reserves for capital items like roof and HVAC.
- Financing: principal and interest, VA funding fee if financed, and any lender-required reserves.
- Buffers: a vacancy allowance of at least 5–10% and a maintenance reserve.
Your lender will evaluate how rental income fits into your qualification. Use recent signed leases or the appraiser’s market rent estimate to support your file.
Avoid these common pitfalls
- Overestimating rent. Base numbers on conservative comps and documented leases or appraisal-supported rents.
- Underestimating repairs. Plan for VA appraisal fixes, especially on older buildings. Get bids early when you can.
- Ignoring lender overlays. Confirm in writing that your lender supports 3–4 units and how they count rental income and reserves.
- Overlooking STR limits or HOA rules. Do not assume nightly rentals are allowed.
- Skipping insurance and utility checks. Confirm coverage availability and how utilities are metered and billed.
A quick scenario walkthrough
You find a fourplex near major employers. You will live in one unit and rent the other three. You verify zoning and existing use with the City of Austin and confirm STRs are not part of your plan. You collect sample rent comps and speak with a property manager to stress test your vacancy and expense numbers.
Your lender pre-approves you for a VA loan and explains how they will count rental income using the appraiser’s market rent. The appraisal flags a few repairs to meet Minimum Property Requirements, and the seller agrees to complete them. You set aside reserves for maintenance and close on schedule, then move in within the typical occupancy window.
Build your support team
- VA-experienced lender who regularly funds 3–4 unit VA loans.
- VA-savvy real estate agent with local multi-unit knowledge and Austin zoning familiarity.
- Licensed inspector with small multifamily experience.
- CPA or tax advisor who handles rental real estate.
- Property manager if you will not self-manage.
If you want a concierge, mission-ready plan for your purchase, connect with Evie Hansen. As a Certified Military Relocation Specialist, Evie helps you navigate VA financing, timelines, and Austin’s local rules so you can move forward with confidence.
FAQs
Can you buy a duplex to fourplex in Austin with a VA loan?
- Yes. VA allows 2–4 unit purchases if you will occupy one unit as your primary residence, subject to standard approval and property requirements.
How soon do you need to move into a VA-financed multifamily?
- VA generally expects occupancy as your primary residence within a reasonable time after closing, commonly within about 60 days, with documented exceptions in limited cases.
Can rental income from the other units help you qualify?
- Often yes. Lenders may use signed leases or the appraiser’s market rent estimate, but requirements vary by lender and whether units are vacant or occupied.
Do you need a down payment on a 2–4 unit VA purchase?
- VA policy often permits 100% financing with no mortgage insurance, though some lenders may require a down payment or reserves for 3–4 unit properties.
What makes VA appraisals different on multifamily properties?
- The VA appraisal enforces Minimum Property Requirements across all units and common areas, so safety or habitability issues may require repairs before closing.
How are property taxes handled on a house hack in Travis County?
- Property taxes depend on local taxing units; owner-occupants may pursue a homestead exemption for eligible portions. Confirm details with the Travis Central Appraisal District.
Are short-term rentals allowed on a duplex or fourplex in Austin?
- Austin regulates STRs tightly and requires permits in many cases. Verify current rules and eligibility with the City of Austin before making plans.
