Live in it and rent out the other units. 

I don’t know if I should invest in the Jersey market and put maybe 20-50% down on something, make less cash flow and make more appreciation, or every two years or so maybe buy something fully cash (my own $) in the Midwest let’s say 5-10 units and make more cash flow with no debt as with the income I make I can just save and buy more, don’t necessarily need to leverage in some markets.

In the event that he moves out in a few years, I would turn the unit into a rental.Questions:1) Since I will be renting to a family member, do I still need to create an LLC?   

You can use this property to hedge any others that you add that may only cover themselves, or require supplement until they are paid off.HOWEVER, if you have decided that your goal is to use Real Estate as a stepping stone to build wealth by upgrading the property you hold each time (condo to house, house to 4-plex, 4-plex to 8 unit, etc) then I think you are right to sell now while you think the property is at the top of it's appreciation.It will be hard for anyone on BP to tell you what to do as we don't know your goal.You are right. 

They sell an older inventory unit, get all there appreciation and equity liquid, and use it to secure 2 new built units. 

Also, I'm not sure how you're paying attention to it on the tax side, but the unit that you are living in's profit at sale is calculated differently than the other unit that you're renting out.Once you move out, that unit is officially available for rent so from that point forward, any profit gained at future sale will be calculated starting from that point and will be taxable.

So you can buy a four flat, live in one unit and rent the other three, but you have to live in one unit on the site. 

Do NOT set up 1 account for multiple units. 

My unit is located by Rose Medical.

Often the unit looks terrible when you’re showing it and is a waste of time.Most owners expect a property manager to work 24 seven but are only willing to pay them six cents to ten cents on the dollar.