Ah, real estate. As we've seen over the past few years, the right investments have the power to grant us our dreams, while the wrong ones might double-cross us when the market dips.

Some real estate investments seem to be ever apt, however, and one of those is a duplex. Buy one to rent out as an investment and you'll probably have little trouble filling it. Live in one half and rent out the other, and enjoy the boon of a handpicked next-door neighbor who helps pay half (or more) of the mortgage.

There are many scenarios in which owning your duplex and living in it, too, turns out to be a smart move. We rounded up three Austin homeowners who live in half of a duplex they own and rent out the other. From a first-time home buyer to a veteran duplex-owner to a young couple who likes the flexible lifestyle their rental income gives them, here's a look at three examples that prove two can be better than one.

The first-timer

Kim Wilcox wasn't really looking to buy when she moved into her South Austin duplex as a tenant last year. She had been on the brink of signing a lease on an apartment when a friend called with great news: A duplex unit had become available next door to someone she knew. Did Wilcox want it? Wilcox grabbed the opportunity to rent the 700-square-foot one-bedroom with loft space, and it even crossed her mind that she would love to buy the place.

The 29-year-old Green Mountain Energy Co. employee had been living in the space for just six months when the landlord called with the question she'd been waiting to hear: He was looking to sell; was she interested?

She was, but his price turned out to be too high.

"I wanted to feel like I had gotten a good deal. He wouldn't negotiate, so I let it go," Wilcox says. But that didn't mean she had given up.

"It's that philosophy of loving with an open hand, and if it's meant to be, it will come back to you."

Something about the situation must have been cosmically correct, because two days later the landlord called her back to tell her he would accept her price.

The deal, which Wilcox describes as a "great learning experience," closed in January. "I remember going home and lying in my bed and feeling like the walls were going to fall just because it was mine," she says.

Not long afterward, the tenants living in the slightly larger, two-bedroom rear unit moved out and Wilcox had the opportunity to renovate, installing new floors and sprucing up the place. She's especially happy with her new tenant, a young professional, because as part of his rental agreement he mows the lawn.

Wilcox, for her part, is learning about landscaping.

"I'm trying to get really low-maintenance stuff into my garden because I don't expect my tenants to keep it up," she says.

Overall, she considers a duplex the ideal first purchase.

"I don't think I would have bought a house. I'm not necessarily ready for that," says the former world-wanderer. "If I ever decide to travel, I could leave and rent the place out. It's not like I have to be here to make the mortgage payment. It gives you that sense of freedom."

The veteran

Cash Edwards' Alan Taniguchi-designed home is not the only duplex on her Zilker-area street. In fact, it's one of five that were added to the neighborhood in the '70s. But it is the only one painted in sherbet shades of peach and lime. Edwards has owned the property since 1984, before she met her husband, Roger Polson, a highway department employee and KGSR disc jockey, with whom she now shares the innovatively designed, five-level space.

"When I first bought the duplex I was single, and I liked having somebody living next door to me," says Edwards, who runs Cash Edwards Music Services, a public relations company for musicians, out of her home.

This duplex was actually the second one Edwards had owned. She bought her first in 1979 while pursuing a degree in real estate appraisal in College Station. Upon moving to Austin, she sold that property, and now she and Polson also own a duplex in Oak Hill, the rent on which more than covers that mortgage, she says.

Naturally, all these years living in and renting out duplexes have made Edwards something of an expert on the subject. She's weathered ups and downs in the real estate market, including one slump in the mid-'80s that was so bad, she says, the home "wasn't even worth the loan I had on it."

She advises potential duplex owners to put their money toward getting the tenant's side "swanked out" — even if the other side is a "hovel" — in order to be able to keep the rent high.

Recently, the couple has had the means to fix up both sides of the duplex, adding windows to the home, which had contained surprisingly few of them thanks to energy concerns in the '70s, replacing all the toilets with low-flow models to save water and benefit from City of Austin incentive programs, and replaced the exterior siding with long-lasting, insect-resistant materials. Thanks to their improvements, they say they save $65 to $70 per month on their utility bills.

Edwards also stresses the importance of finding long-term tenants in order to save money on turnover costs, though she's philosophical about it.

"You usually have tenants for a year or less," she says, "then you find ones (like current tenant Pam Blanton, of Pam Blanton Public Relations) that stay for years."

And you don't want to rent to friends.

"Every time we rent it to a friend, something happens," she says with a laugh. "But then, we have musicians for friends."

The family

When Steve Burger first bought the Allandale duplex where he and his wife, Nickole Gann, live with their two little boys, he had a different set of life circumstances.

It was 2000, and he was single and working at a tech company. "It was time to buy something," he says. His sister and her family had lived in the neighborhood for 15 years, so when he drove by a corner duplex with a for-sale sign posted, "I jumped on it," he recalls.

Six months later he met Gann, and her job ended up taking the couple to the Caribbean for two years. When they returned, they moved into one of the duplex's three-bedroom, one-bathroom, 1,000-square-foot units.

Unlike most duplexes, where units share a wall, this one is joined only at the carport roof. Since it wraps around a corner, each unit faces a different street and even receives mail at a different address. The units do share a large backyard that, Gann admits, their dog and children have mostly taken over.

Their tenant is a single woman who has lived next door five years and whom both Gann and Burger describe as "fabulous." Having hand-picked a good tenant (important, because they're not just tenants, but also neighbors, Burger says), the couple has only had to deal with renting out the unit once in seven years.

Gann concedes that it has gotten a little crowded with the couple, their 2-year-old and 6-month-old sons and their large dog. She and Burger have thought about buying a bigger house and renting the entire duplex out, and they even toyed with the idea of converting the duplex to condos and selling off each individually, but for now they've decided to stay put.

With more than half of their mortgage payment covered by the rental income, Burger is able to stay home with the kids (though he has a part-time job at REI, "for sanity and adult conversation," Gann says), something the couple probably wouldn't be able to afford in a different situation.

"If we had a big mortgage payment every month, both of us would have to work," says Gann.

And a home that proves a sound investment in both their children and in the real estate market is a pretty good place to live.