1st time buying: Should we Buy to live or buy to rent out? (CA)

[Julian Pulido]

Hello BP fam, I wanted to reach out and see if someone can provide some recommendations on what route my wife and I should go. We recently got engaged and we are looking to purchase our first home this year. My wife was recently been approved for 460k in the Merced county area (Ca). I recently started a new job, which is the reason we are relying on one income for this loan. Given the recent increase in mortgage rates and the low number of houses in the market, is it smart for us to purchase a home that is above market price? Or should we take the approach of purchasing a lower priced home and maybe renting that out? We both are living with parents at the moment and buying a house is something we absolutely want but not necessarily need. The flip side of not purchasing is we can save more money. We currently have about 50k saved between the both of us. However we are scared that the market is only going to get more competitive and we at some point may run the risk of getting priced out and having a higher interest rate. Any suggestions or direction is greatly appreciated.