Thoughts on buying a primary residence or keep renting and invest

[Caleb Rogers]

Should I save up a down payment for a primary residence, or use that money to invest in one or more rental properties? I know there are plenty of people on both sides, but I'm curious if someone here has done one and wished they had done the other?

I have one rental property, and I'm currently renting an apartment. My wife and I would like to buy a house, but we would also like to invest in a lot of real estate. For one 20% down payment in my area, I could probably acquire two or three good rental properties (with 20% down) in the same market as my current rental. But as we know, I can get into a primary residence for anywhere from 3.5% up.

If I buy a primary residence with a big enough down payment I can use a heloc to invest, but it take a while to get to that dollar amount. If I aim for rental properties, I'll get cash flow, but I'll keep using my cash reserves to buy houses and not be able to have a down payment for a primary residence. At least not for several years.

Renting isn't too bad, but houses in my area have always appreciated well, so that's a consideration. I know at some point, I'll have enough cash flow that I'll be able to buy a place to live, but should I wait? Who has done one and wished they did the other, and why?

Oh, and there are no duplexes in the area, so house hacking is likely out of the question. Also, I don't have the money saved now. I'm trying to figure out my strategy here, because I need a clearly defined objective to create the success I'm after.