Well, first of all, I think it's very nice that he wants to provide a home for his family, but............you will soon be his " family", too, when you get married, so I understand that you want to be sure he isn't putting your financial future in jeopardy.
That being said - has he spoken to a mortgage rep yet?
I think that would be important to do first to see how much of a mortgage he would qualify for.
From what you said, he wants a 2 family home so that he can rent out the 2nd floor and give the 1st floor to his family - rent free.
Are they in a position to help pay something monthly? Are they really willing to let him pay for it all? (remember, these will be your future inlaws!!)
Then, his plan is to buy another home in 2 years for the 2 of you.
Now, as to the home for the 2 of you once you're married.........when you look at the numbers with a lender, you will see how much of a loan you can get, and what your total costs will be..........those numbers may be enough for him to realize he is taking on too much financial responsibility.
By the way - is he asking you to go on the mortgage with him for the 2 family home?
If he is - I say don't do it, as that's between him and his family!
I don't know you or your financial picture - no idea what your incomes are......so it is really hard for anyone to help you with advice.
You're engaged to this man....you need to start now in working out differences you have.
To a certain extent, what he does with is money and family now, as a single man, is his business, but...........how it will impact your life with him down the road is something you need to sit down and discuss with him.
Get ready for marriage - it is full of compromises!
You need to work this out between you!