My first purchase - my own home or an investment property?

[Mario F.]

Hello, I'm just beginning to learn about real estate investing and am having difficulty deciding on whether to buy my own condo here in Los Angeles as my first property, or to invest in cash flow rentals in Phoenix or perhaps Palm Springs.   Los Angeles is so tough to get into now that prices have risen so high.  I have a decent income but feel like saving money would be tough to do with a huge mortgage. I'm thinking that cash flow from rental properties could help me save faster and ultimately help me get into the LA market in a few years. 

Any advice would be helpful. Thanks!

mario

[Chris Mason]

Unless you've got a sweetheart deal with something like permanent rent control or a family member that's totally cool with you living there forever, primary residence first.

• Lower barrier to entry. 3.5% or 5% down. Get the appreciation machine moving sooner because of that. 
• The place you buy with 5% down can very well become your first rental property a year from now.
• Really learn all the responsibilities of homeownership. You have those same responsibilities, mostly, as a landlord. 
• On average folks buy nicer homes in nicer areas for themselves, than what they'd buy to rent out. The above mentioned appreciation machine thus will on average do better.