Shall I invest or shall I buy a primary residence

[Jay Wang]

Hi,

I am a single engineer in my early 30s. I was able to save 200K but the maximum home I can purchase in bay area, California is 1.4 million. I cannot afford any single family home in mountain view, and I don't like to live more than a half hour drive away from my house. I am happy renting an apartment for $3000 now, with around 10 minutes bike ride to work.

My question is: would you recommend me to:

1. buy a single family home in South San Jose, drive an hour to work every day. I will hate my life but the home appreciation is fast.

2. Invest in multiple houses in Raleigh, Austin?

I have a colleague who bought 3 new homes in Austin near the Tesla factor in Mar 2020. And her investment properties already appreciated 100K each house. I am thinking of buying homes as well, but not sure if the market is too high now.

Any advice will be appreciated! 

[Justin R.]

Buy a 2-4 unit (or SFD and house hack) in a quality area, within driving distance to you job. Utilize the benefit of a conventional owner occupied home loan, and place the lowest down payment available to you without PMI. You will be living here and utilizing the advantage of your high appreciation market, compounded with quality leverage from an owner occupied loan. You DONT need to stay here forever and "Hate Life", as you can move out and recreate shortly after. As a matter of fact that drive time may encourage you continue your growth a rapid pace!