San Francisco: Buy primary residence first, or start investing elsewhere?

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Hey everyone! I'm a new investor in San Francisco and I'm trying to find the best way to get started.

TLDR: I'm trying to decide whether it'd be best to start by buying my own primary residence in SF or start with investment property in Florida.

Background

I'm originally from Florida and have family in Cocoa Beach. I plan to invest heavily in that area mostly because of proximity to family and the fact that we visit often. It's also quite a bit less expensive compared to SF and being a fairly popular vacation destination gives us a nice fall back option in the event of vacancies or changes in the economy. In particular, I'd like to buy and hold small to medium sized multi-family properties on the beach.

My wife and I are currently living in a small one bedroom apartment in the middle of San Francisco. We got in at a good price in a great neighborhood with rent control and it's a pretty nice apartment, but we'd really love an extra bedroom and a little more space. I'd also like to be paying off my own mortgage rather than my landlord's :D The problem is homes are so expensive that it would significantly impact how much money we have left to invest each month, at least initially.

Financial Situation

Right now I have no debt other than a small car loan, a couple thousand in savings and about $50k in stocks I could sell for investment capital. We currently have about $2500 / month we can put towards saving and investing. If we buy, that would go down to $1000-1500.

In order to get in on the market here, we'd need to buy in a less desirable neighborhood (but still fine — and potentially more possibility for appreciation), and wouldn't be able to get exactly what we want, but mostly. The upside is at least we'd have a house here. We'd also have a lot more room and although we'd be paying quite a bit more towards housing each month, it'd be building OUR equity rather than the landlord's.

I'm also in a bit of a unique situation where I'm able to get a 0 down loan with no PMI at 5.125%. I'd pay a little more in the long run, but could buy now before prices go up too much more.

The other scenario I'm considering is waiting until the end of the year and buying a small multi-family property in Florida with the goal being to acquire one or two more the following year and THEN buy our own place in year 2 or 3.

If I buy here in SF, as long as the house doesn't need a ton of work, I'd still be able to buy investment property about a year from now. The difference would be I'd just need to start with cheap SFRs or duplexes and work up to the 5-10 unit MF buildings I'd prefer to hold long term.

So with all that background, what would you guys recommend? Thanks ahead of time!

[Amit M.]

my personal advise: buy in SF, hand down.

Why? We're at the start of the RE cycle and I believe your chances of significant appreciation are very high. You can later buy in FL if you wish, but I wouldn't be surprised if the percent equity you gain in your home is greater than what you gain in equity plus cash flow in FL.

FL is mostly a boom and bust market. SF is basically an up and up market. As you know it's extremely restricted wrt growth, has tons of tech money pouring in, and is in constant demand. Like everywhere, SF went down during the recent Great Recession, but most neighborhoods were down 10-15% while most other cities were down 30-50%. And SF is already up BEYOND its high of 2007. It's like recession, what recession?

Oh, and as for the 'my home is/is not an investment' debate, here's my take: if you gain equity (almost a certainty in SF) than you can borrow against it to buy more real estate (and to me that makes it an investment.) Worked for me. Like a charm.

My personal opinion- if you can afford to buy here, do it.