Should I house hack?

[Michael S.]

after paying my home off I am wanting to jump into to real estate head first. I am having trouble deciding if I should buy an investment property, Live in it and rent my current home while fixing up other property. Or should I buy duplex live in one side and rent the other side, plus my home?   

The hardest thing will be trying to get my wife onboard. As we are expecting a child around when this will take place (spring 2015).

[Jon Holdman]

"House hacking" seems to be a buzz phrase for various forms of investing that involve you living in an investment house.  Personally I really dislike this term.

Living in a house while fixing it is very disruptive to your home life.  Is this your first child?  If not, you understand what you're in for.  If it is your first child you really have no clue how much your life is about to change.  If that's the case then I would not recommend buying a fixer and trying to rehab it while living in it and having your first baby at the same time.  A divorce is a very real prospect in that situation.  I'm not even joking.  Especially since you mention the difficulty of getting your wife on board.

I think there are serious trade offs you make when buying a duplex (any multi) and living in one unit. When you buy a residence you have a whole set of criteria, none of which are "is this a good investment". When you buy rentals, that's ultimate your ONLY criteria. If you try to make one property do both, you're going to have to compromise. My normal advise would be to buy a good investment even it means compromising on the residence requirements. But, here again, with a wife that's not fully on board and a new baby on the way I think you're playing with fire. The only real upside to this process is the low down payments to get into an OO multi.

I think a better strategy is to realize that a residence is nothing but an expensive doo-dad.  Buy or rent the cheapest thing you can that meets your needs.  Then, save and buy rentals as you have the money.  Focus those purely on profitable rentals.