Getting started on the right path.

[Doug Royce]

I'd like some advice on what avenue to take for my first investment property.

I bought a home last year with great equity and cash flow potential, but it's my current residence and I'm subject to live in it for another 3 months due to owner occupancy requirements.

However, I don't want to wait so I've been in the market for another property. Preferably a SFH or Duplex as an investment property.

My two options are:

1. Wait 3 months, move out into another property and rent out my current residence.  This allows me to save money.  A lower down payment moving into another owner occupant (3.5-10%).  Save up a little more over those 3 months and fix up my current property in preparation to rent it out. (I've already renovated the kitchen). 

2. Buy an investment property now.  This would require a larger down payment, 20-25%.  However, if I can find a great deal with tenants in place it would immediately create a return and I could house hack my current residence by getting a roommate.  I'm focusing more on small multi-family like a duplex.  Based on the market it seems they create better cash flow for me.  Much better than my current residence could.

Now at first it doesn't seem like option 2 is a very good idea, its a larger initial investment, but the returns are greater as well.  More risk more reward.  Option 1 is more conservative which seems to fit my personality a little more.  However there is no telling how long it will take to find another residence.  I want to pull the trigger and get invested now.