Invest the whole $400k in an index fund (market is almost -30% right now) (will probably DCA througout this bearmarket then) and rent an appartment until I’ll sentle down with my GF (5-7 years from now) and buy a house with her.

Down side is it's a variable rate product which is tied to the Prime Index. 

There are the CMBX indexes that us little guys can trade. 

My decision is between buying a small multi-family or putting more money in index funds during this market downturn. 

You can put all that money into a low-cost index fund like Vanguard, hardly have to pay anything in maintenance or you could put it into real estate where even without a mortgage, you are still paying for maintenance, some utilities, and property taxes. 

As I mentioned, I'm pretty frugal so the money would be used to save, pay off debt, and fund other investments (index funds or rentals) and not on gold plated wheels.I should also mention that I no longer see a house as a home, so I intend to keep on buying and moving until I decide to call it quits. 

The S&P 500 index has averaged 11.3% over the past 80 years. 

Index funds?

Stock market (index funds) return an average 7.5% adjusted for inflation so I believe if you're doing REI, at least shoot for something higher than the market. 

We have approximately $19k in a taxable brokerage account in an index fund.