My opinion is in both cases I would recommend them start in their home market or a market that they know like their home market and educate themselves on options. owner occupancy provides opportunities that are unavailable by long distance RE investing.In my high cost market, a new investor can use a NACA loan or 95% LTV conventional financing on up to a 4 unit owner occupied property.  

It's now nearly fully occupied and rents are going back up.

While opinions may vary, I rely on data to help drive real estate decisions and planning.Key ConsiderationsEducational Attainment: 77008 boasts higher numbers of residents with bachelor's (12,241) and master's degrees (5,739) compared to 77063.Demographics: 77063 has a higher percentage of foreign-born residents (41.02%) which typically indicates a strong rental market and with 76.86% renter-occupied versus 32.60% in 77008.Economic Factors: Median income in 77008 is $140,609 with a low unemployment rate of 3.37%, whereas 77063 shows lower median income ($51,899), higher unemployment (9.99%), and more families below the poverty level (16.51%), which may indicate economic diversity but also potential rental payment risks​​.Age Distribution: 77008 has more middle-aged residents (35-54) [8970 compared to 6,115] and a slightly higher proportion of young adults (25-34) compared to 77063 but both are popular with younger adults suggesting strong rental markets equally exist.

I am looking at a complex to invest in with 18 units that are fully occupied.

Think something off-market that's already tenant occupied and producing.I've done this several times with clients in Detroit where they get most of their capital, and sometimes all, back out. 

Your bid would have to exceed $300K.To be an “Eligible Tenant Buyer” you must occupy the property as your primary residence at the time of the sale, with a proper lease dated before the NOD was recorded, and you cannot be a member of the borrower’s family.

And correctly..you cannot co sign as a primary if it's occupied..2+ units can sometimes require larger down payment (as you've found) another option could be to access equity against another property..check in with @Joseph Chiofalo for potential lower down payment options..might be able to get to 15% down..Good luck! 

In the upcoming year, we are getting roommates to help with expenses while continuing occupying as primary residence.

Have the current owner notify them that you intend to occupy the unit and want them out.

 the more competitive rates are  6.9% for 20% down owner occupied, 780 credit score. 7.45 and 1 point for a duplex seems pretty solid.