They get a higher return since they are covering housing cost, have the $250k per spouse primary residence deduction in gains, is a savings account, higher leverage position, lower interest rate possible, will pay more premium for location, etc.House might be overpriced for REITs but not for home owners.  

Non pay of prop tax's non pay of insurance  Waste, etc. 

Avoid PMI and then go to a local credit union and get a heloc after closing to gift the money back.Have this as a tool in your tool belt but pursue use of the 3.5% FHA, knowing that you will be at a competitive disadvantage if you are competing with non FHA buyers, then you can call in the favor from your gift person.Just know that if someone gifts you down payment money, your bank will require them to sign a letter stating that it is in fact a gift that doesn’t need to be paid back.

is so what lender did you use that provide non recourse loan?

I stayed in touch with all of my investors who bought off of me to see how well they did and my biggest joy was when they returned to buy more or told their friends about me and what I do! 

I will return to this situation in the end of this post, but first let me show you why the age of a person can be tricky when it comes to the IRS.

Right now, Austin rents have softened and rent returns are very challenging. 

You'll have more flexibility with non-traditional lenders, traditional will all follow the same Fannie/Freddie guidelines.

This could work well if you’re looking for steady monthly returns and don’t mind managing tenants (or hiring a property manager).Selling could also make sense if you’d rather use the $500,000 to diversify into other investments, like buying multiple properties or even a short-term rental on the lake as you mentioned.

Some considerations (in no particular order) are: What return on your equity are you currently getting?