Critique strategy- Buy Short Sell for primary, Rent out current
Please critique this strategy:
I want to buy a short sell to live in and rent out my current home.
We are also feeling a bit cramped in current home and would also like to change neighborhoods for a variety of reasons. We did not purchase our current house at a deal, per se, though it has appreciated quite nicely in the 7 years we've owned it. I know I need to make my money "at the buy" as an investor. So what if bought a primary residence at a discount via a short sale? If we are going to move anyway, is this a good way to get our foot in the investing game? I really want to make the leap this year and this option seems reasonable in my head. The reason I am thinking this could work is that we are wanting to move anyway but are also not in a hurry and short sales are slow.
Here are some numbers: My current PITI is $1,360. I think we could easily rent the house for $1,850 per month maybe more. $196k left on my mortgage. Our realtor said she would list our house for $310k, but I think that is a tad high.
We could buy a larger house for less money per sqft where we want to move. Considering a short sale discount, I was hoping we could find a place we wanted to live for about $250k.
We are within 5 minutes of 2 military bases in Virginia Beach, so the rental market is strong with good candidates.
Foolish plan? Or a smart way to start our REI journey given that we want to move anyway? Or just sell this current house if we want to move?