Deal Comparison - Strategy Advice

[Michael Garson]

I'm a new to this, and would like little advice on strategy.

My plan is to end up with with two houses in two years. One rental, and one for me. Then see where I'm at from there. Basic buy and hold, conservative plan.

My plan is either -

A. Cheap single family, live with a roommate, save money for downpayment then buy next house.
or
B. Multi unit with FHA loan, live there for a year, then later house for me.

Both plans allow me to live in in either place, and I am paying approx. $300/mo. of the expenses my myself.

Looking at two properties now , can't decide which way to go first.

All houses are in Philadelphia:

1st Option -Small Single Family 3 bedroom. 1 1/2 bath
110K

Would rent for approx. $1,000 - $1,100 without too much work.

Looks like it was a senior's house, old wallpaper, decent shape, My plan would be live there for a year, have roommate pay half the mortgage, get rid of carpet, spiff up wood floors, update heating (special programs make this almost free) etc... Then move out and rent it. Fix basic kinks to make it a low maintenance rental.

Comparables: Similar house (very fixed up) 3 doors down just sold for 200K, Some sold for 150K. Some sold for 115K. I might get some easy equity out of this, not sure how much (could possibly use towards next house).

2nd Option 2 Unit -
$200K -

House already improved - (For comparison sake we'll assume it needs nothing)
1 unit currently rents for $950, other could rent for $700

I would live in the 1 bedroom and save for next downpayment.

Satisfy 1-year owner-occupied deal, move on to another building and rent out both units.

Comparables: Single units in similar shape are selling for $150 for much smaller 2-3 bedroom. Best other comparables are 3 units selling for 300K.

Thanks for any advice!!!!