House hacking in expensive areas!

[Gia LaForge]

Hello BP, 

We have a couple of opportunities opening up, so I'd appreciate your advice about these:

1. Option 1--buy the other half of our duplex-- We currently live in a duplex, but we've been told that the other side of the duplex will be for sale this summer for around $450K. We currently owe $200K for our side. I know real estate is going crazy all over the country, and it is crazy here too. I ran the numbers, and we would be cash flowing around $600/month. My husband is worried that with both properties, our mortgages would be $730K if we used equity for the down payment, and that just seems like a lot to get into for a first deal. I know some people can house hack and have their whole mortgage covered, but that wouldn't be the case for us since prices are so high here. How do we save for CAP Ex and maintenance when not all of the umbrella mortgage would be covered by the tenants on the other half? How do you handle the split between the business and personal?

2. We have a friend who flips houses about 2 hours from here. He offered us a property that we could BRRR, but it has mold and hasn't been touched since 1980, so there is A LOT of work to take on. That seems like a lot to take on for us, especially when the property would be vacant for 5 months during the rehab, and we'd have to pay the mortgage. It would also be harder, but not impossible, to self manage a property that is a few hours away.

I know in REI, we are all in it for the long-term benefits; how do we know which will be best? It's great to have options, but it's also not really helping us take this first leap! Thanks for your help in advance!