Our favorite middle path does both: buy a duplex, triplex, or fourplex, live in one unit, and let rent from the others help carry your mortgage. For a first-time buyer trying to combine homeownership with cash flow, owner-occupied small multifamily is one of the best moves available. You get a home, tenants offset your payment, and you start building a landlord track record with your lender's blessing. A few financing realities to plan around: - FHA runs a self-sufficiency test on 3-4 unit properties (duplexes are exempt): 75% of the appraiser's market rent for all the units has to meet or beat the full monthly payment, including taxes, insurance, and mortgage insurance. The 25% haircut accounts for vacancy and upkeep, and when rates are higher, fewer properties pass. - Conventional works for owner-occupants too. Since November 2023, Fannie and Freddie allow as little as 5% down on a 3-4 unit you'll live in as your primary residence. The 25% down requirement people quote applies to investment purchases, not to a primary residence you occupy. Buying a pure investment property before you own any home is the harder road for a different reason: rental income rules. If you have no current housing payment history and no landlord track record, the projected rent on a new investment property generally can't add to your qualifying income; at best it offsets that property's own payment. Living in the property you buy sidesteps the whole problem, which is one more reason house hacking tends to win for a first purchase.