First Time Investor - Condo or Multi-family?

[Ian Viray]

Hello,

So I currently live in San Diego, CA and I'm looking into investing in real estate. I have two options right now: first option, I can afford to buy a condo this summer with at least a 5% down payment and I plan to live in it for 1 year then rent it out. Second option, I plan to save as much as I can for one year (on target to save at least 22k by Summer 2019) to have enough down payment for a multi-family home.

My goal is to build enough passive income a month in order to quit my job. So, which is the better option right now? Are condos good for starting out so I can start building equity? Or would it be better to save up for a multi-family home?

-Ian

[Chris Youssi]

Need more information to give you accurate input. A few ?'s

How much can you rent the condo for - what is your net + cash flow after expenses / don't forget about HOA dues.

How much will you need for a down payment to purchase the condo?

What is the appreciation rate in the condo unit over the last 3 years ? Now calculate the cost of waiting to save more money - you will lose that equity regardless of multi or condo

The cost of waiting can be expensive - we are in a rising interest rate environment - do a calculation on the cost of waiting with rates at 4.5% vs 5.25 or 5,5% in 1 year which is very feasible.

What is most important cash flow or appreciation?