By stretching a little you will not only get a better location, but the value of your home will be more likely to retain its value if not increase in value. You will want to look for one of the smaller homes or one that needs a little TLC. Good luck.
I'm not a fan of putting people into "paycheck to paycheck" situations. It's not financially smart, and you won't enjoy your new home if you can't even go out to eat dinner once in a while.
If you worry about your investment, I would stretch to get a cosmetic fixer in the best neighbor. It will be an automatic winning situation for you.
In many areas of the Country, people are moving back into the city, rehabing homes and selling for a handsome profit after everyone else moves to the neighborhood.
Do some research before buying. This is something you must research yourself.