To buy a rental or a primary residence, that is the question...

[Sam Tanner]

Hey everyone, I am brand new here!

My fiancé and I are looking at purchasing our first home. I've spent the last few months researching properties and working with various banks and credit unions to see what kind of mortgage we qualify for. We've looked at properties in Washington, Oregon, California, and Hawai'i (hot markets, I know, but this is where we are from and where our families are) and we've settled on central Oregon/Bend. 

In general, I am wondering if we should be looking to purchase a primary residence, a rental unit, a primary residence plus a renovation/RenoFi loan for an ADU buildout, or maybe even a multi-family where we occupy one of the units and rent the other(s). I know this question pops up quite a bit on here and I have read through quite a few of your thoughtful responses. I figured it bears repeating given inflation, rising interest rates, and current blast-off of the market, especially in the locations we are looking in.

A bit about us that may be somewhat helpful:

• We are first-time homebuyers with no debt to our names (thankfully!)

• We both have low 6-figures incomes or close to it

• We have adequate savings for a down deposit and we have family who have offered to help as well

• We are fairly frugal: we have no interest in fancy cars or clothes, our idea of a great vacation is a backpacking trip, and a night out is usually for some beers at a brewery

Thank you in advance for any insights you all have, I am trying to be as much of a information sponge as possible!

[Brian G.]

@Sam Tanner dude consider house hacking. The most cost efficient is to find something already built: a large house where you can rent out bedrooms, a multi unit where you can live in one and rent the others, a house with extra square footage that allows you to add a private entry and create a little studio or 1 bd unit to LTR or STR (?), etc. I would not build an ADU in most cases from the ground up because you won't be able to get an increase of equal value in equity for the money spent. You're on the right track. House hack for a year. Rinse and repeat. Good luck!