To buy a home or rent a home and buy rental property

[Ryan Hutchison]

my wife and I are looking to move into a house from our condo.

My question is:
Should I use the profit from our condo sale to buy a house or buy a rental property and then rent a house for us?

Depending on the cash flow of the rental property it looks like on a monthly basis it would be cheaper for us to rent as the cash flow would off set the rental payment to below what our payment would be for buying a house. We will have about $20,000 in escrow once our condo sells.

Example:

3bd/2ba Rent: $1500
Rental cash flow: $300
Puts our rent at: $1200

3bd/2ba Mortgage payment:$1300

What do you think?
Any suggestions?

[Ali Boone]

The latter. I won't buy my own home, I only rent (until I have enough expendable cash to just play with). I buy rental properties instead. Several reasons, but the two easiest being 1. buying your home is not an investment and 2. flexibility of not being stuck in one place.