I would love some advice on my specific situation. I’ve been interested in getting into real estate as a way to potentially have extra income and also have more of a safety net in retirement, either through cashing in on equity or continuing to own rentals. I’ve read about 4 books, listened to tons of BP podcasts, but I have somewhat unique situation, and I’d love to hear what others would do if they were me.

I am married and earn a good income, but we are a single income household—my husband is disabled and cannot work. We do not have kids. I am a professor and I make $200k/year. I’m 47 years old. I like my job and am not looking to replace my W2. But due to spending so long in grad school and having one income and a much lower salary for most of my career, I feel behind on retirement.

We live in an expensive city now our home worth is at least $1.15 million and we have 500K in equity.

We are moving again for my job to another very expensive city. There are some serious housing perks with my new job offer: 1) $150K in a 0% interest forgivable loan for downpayment (10% forgiven each year 2) a special home loan program that is currently lending at an interest rate of 4.1%. 3) Can join a waitlist for on-campus faculty housing that is sold for at 50-75% of the fair market value consequently when you sell you are capped at how much you can sell for; waitlist for these homes is approximately 7-10 years and you can stay there until you die).

I think my options are :

Sell current house, sink most/all proceeds from sale into new house; buy as much of a house as we can buy because it’s a hot market and should appreciate well. Put myself on faculty housing waitlist. Live in new home while it appreciates for 10 years until I get a faculty housing spot, sell private market house, put proceeds (minus downpayment) in bank for retirement (I estimate this will be 1.3 mil before capital gains and real estate fees based on 7% growth in a very desirable Southern California location), and take out new loan for lower cost faculty housing. This feels like the easiest option, but the one with the least flexibility/back up plan. If something happens to the faculty housing waitlist, we have no way to catch up on retirement by cashing in on the appreciation.
Keep current house as a rental. In new SoCal market, downsize and use only the $150K from the job perk as downpayment in new expensive market. Put myself on faculty housing list and wait 10 years while the smaller, downsized place appreciates at ~7% and our rental house appreciates at 4-5% per year.

We would be stretched to afford this for at least the first year. I’m also scared of the downsizing aspect; we’d probably be looking at going from 1800sq feet single family home to 1100sq foot townhome). I feel like the next 10 years, ie from age 47 to 57 are not necessarily ones during which I want to be downsizing or worried about money. However, I think this would be the most profitable option (probably 1 million additional dollars.

Sell our current house, but put only some of the profit from the sale into the downpayment for the next house. Keep ~200K and try to buy some cash flowing rentals in a much cheaper out of state market. The area where my mom lives is inexpensive and seems like pure cash flow could be $300-400/ month or more. If done right, potentially, I could get cash flow for current years that could continue and grow into retirement and be an alternative to trying to stack 1 million more dollars in the bank. This option feels like a good one except I have no idea if I’ll hate being a landlord. I do like real estate, I have a great eye for design, but would hate to have to evict someone—that would be my worst nightmare, so I’m not sure I’m cut out for being a landlord (although I would fully anticipate having a property manager)

Is option #3 a far inferior option compared to keeping our expensive house in expensive city as a rental and only having to deal with one property that gives us great appreciation in 10 years ?

I realize this is long and specific to my situation, but I would love opinions from people with experience in real estate. Am I missing other scenarios?

Thanks for reading!! And thank you for any advice!!

Seattle, Washington

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