Would you buy first Primary Residence or Investment and why ?

[Olivier H.]

Hi everyone,

Been a long time observer but this is my first post so please excuse me for going back to basics

I’m trying to figure out what’s the best strategy to start and if in your opinion you should buy your first property as your primary (and do some type of house hacking) or buy an investment property first.

Second part of the question is for your first loan is FHA always the best option and which route would you go. Borrow as little as possible or as much as possible and why ?

If you made it until then thank you, much appreciated

[Dan Weber]

Some of this is going to be determined by your financial situation anyway. If you are going to buy strictly an investment property that you do not plan to live in, do you have 20%-25% cash to use as a downpayment? If not, then an owner-occupied loan (loans with smaller down payments that require you to live in the home) will be your best option. Also, just because a property is your primary residence does not mean it isn't an investment if you are using it to make money. Buy a two or three family, live in one unit and rent the others. This is your primary residence and also a long term investment. When borrowing as much or as little as possible, if you have the ability to put down 20%, it will come down to your investing preference. Some investors prefer to put more money down as it gives you more cushion in the event of your property value dropping and other life events occurring that would require you to sell. It is deemed a safer move. On the other side of the coin, many investors think it would be foolish to not borrow as much as you can while locking in a historically low interest rate. That will be personal preference.