Buying a home to live in and later as rental unit - East Bay area

[Sun Kim]

I like to get your opinion.

I am thinking of buying a SFH in the Dublin, CA area to live in, then rent it out, then potentially moving back in. I have other properties, and have never sold a home, so I expect to keep this until the mortgage in paid off. I have other rentals out of state. I am looking at between 1,250 and 1,750 sqft home and price ranges from $800k to $950k. Estimating that taxes will be 1.22% of the price. I plan to put down 30% on a 15 year loan around 4.25 loan, without points. I estimate my mortgage to be above $6k, and this will test my available income flow form my salary. I am currently renting $3250 per month in a town home. Does it make sense to buy now, to save $39k per year? I estimate taxes and insurance on $900k home will be $12k not including HOA. I've seen some home where people buy a home for $1M, just to rent it out for $3500, that seems crazy. It the appreciation which I believe is loosing steam worth it in the long run?

I figure that I would come out ahead if my new home appreciates $50k over 2 years to offset the 5% commission I would pay.  If I deduct 2 years of expenses (taxes+insurance) of $24k from my 2 years rent I would pay of $78k, then I am as a positive $54k.  Is my math correct, and am I thinking correctly in savings, did I forget something?

It it better to buy a upgraded or at least fixed up 1962 built SFH around 1500sqft with a yard, and drive way or a recently built 3 level SF townhome with no yard and no driveway from a rental perspective?

Thanks.