Sell stocks for down payment or use heloc

[Rachel M.]

Would you sell stocks for a down payment or use home equity to finance an investment property? Background: I purchased my home for $325k. Put $185k down. Comps in my neighborhood are selling for around $430k at this time. I want to purchase an investment property in my area (central coast of Ca. Paso Robles/ Atascadero/ San Luis Obispo). The median home price here is $530k (San Luis Obispo). Because my income is not very high and the housing prices are high, I won't qualify for very much. I do have quite a bit in blue chip stocks but not much in savings. Ideally, I want to purchase a larger home that I can move in to and rent out a granny unit (either air bnb or LTR) and keep my current home to rent as a LTR. Realistically, I'm thinking I will have to sell my current home to purchase the bigger home, unless I come up w a large enough down payment to put toward the bigger home. So, w that information, what the heck should I do?

[Scott Weaner]

I am no accountant, but I have done both. I would rather use a HELOC, as interest is tax-deductible. If you sell stock you will have to pay capital gains taxes.