When i was your age I THOUGHT I needed a large house especially one with a basement. House #2 is basically what I have now. Now that I'm old and retired I wish I had house #1 because a large house is a lot of work to maintain, not to mention cost of heating and cooling.
Since your are young I say go for it and buy house #2 and keep house # 1 for rental. Unless the tax laws are different in Utah you can come out ahead because the interest and property taxes are deductible on at least your federal tax return. if you rent for the payment you can claim a net loss also.
“You live and you learn, but if you never learn, at least you are still living.”
— Unknown
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