Don't over-mortgage yourself on the new primary home purchase. Keep your townhome as long as you can for passive income and let someone else increase your equity in it over the years, and therefore net worth. The goal is to try and never put yourself in a position where you need to sell your townhome. You want at least a 12% ROI on your townhome when it turns into a rental property. Keep the water/sewage bill in your name, it's lienable to the property if it goes unpaid. Have your new tenant(s) setup everything else in their name (internet, tv, utilities, etc). Avoid a property manager, especially for 1 property not far from your primary residence. They charge an arm and a leg. So much that you may not even break even. Use TurboTenant

ETA: My wife and I both owned our own properties when we met. I eventually moved in with her in her condo and started renting my small house. Once we got married, we then bought a new primary house that we will raise our toddler son in. As soon as we bought the new house Spring '22, we started renting her condo as well. We now have a primary house we love and 2 rental properties with great long term tenants in both. We refinanced both properties to super low rates during COVID and cut our mortgages on those properties down quite a bit. Our monthly profit from the 2 rentals almost cash flows our primary house mortgage payment. I'd love to buy a 3rd investment/rental property in the next 5-10 years to grow our potfolio. When you start renting your townhome out, start an LLC for protection.

Property ownership = wealth. All of our properties will go to our son when we pass, through the trust we already put in place for him. I'll die happy knowing everything we work hard for will be passed down to him so he will be financially secure once we're gone.

This post was edited on 12/28/23 at 9:04 am