Advice on first purchase: Rental or House Hack?

[James Lee]

Hi BP Friends, 

This is my first post here but I have been a long time creeper. I am finally to a point where i think i am ready to make the first step into my real estate investing career. First i'd like to lay out my goals and background. My goal is generate cash flow and equity as quick as i can leveraging any safe stratgies i can come across. Five years from now i'd like to have multiple cashflow positive rentals (hopefully enough to suppliment, at least partially, my income). I have up to 30K for a downpayment, a stable job, and a great credit score. I'm comfortable doing general fixer upper tasks (sheetrock, cabinet install, etc).. A few months back I got prepared for up to 500k, which IMO is wayyy out of my comfort level. With all my goals, requirements, and limiting factors i have decided on two routes to entertain. 

Option 1;

I am in the Tempe, Arizona, and the entire phoenix area is approaching all out of my price range for a SFH (which is preferable, no HOA, etc). I am in the university area so my mind goes to; buy a condo near the university with 3-5% down that needs a little work. I would plan on living in it while i fix it up, for a year (as required, i think). Here is where i am confused, once fix it up the goal would be to rent it out and do it all over again. My question is how, do i refinance and hopefully have enough equity to roll it into another place? What happens if I don't get enough out of it to justify a down payment, couch surf?! This is one of the few apprehensions with this option, also how much over market value places are going for in the Phoenix area.

Option 2:

This is the option I have mostly been entertaining because of the prices in the Phoenix area. I was looking at putting 20% down on a 2-4 unit building in a smaller emerging market where i can afford to put that much down. Ideally the property would have long standing tenants or need minimal work to get market rent ready. I would then hire a property manager to handle everything month to month, and i would collect the residual. I build a spreadsheet base off the BP analysis video to run numbers and this hands down seems like the most profitable option for cashflow, some deals i've looked into show 500/mo cash flow. I would then save the profits and roll it into a SFH or something I can move into and house hack. Am I missing something here, is there something i am not considering that would make these deal less than desirable?

Sorry if this came off rambling or too dense, any insight is greatly appreciated.