1)If you by a condo make sure it is a newer, quality building on a good location. Buying a house over a condo might come down to personal choice based on lifestyle likes and dislikes. Five years is a pretty long time to be somewhere that doesn’t mostly suit you.
2)Don’t know
3) Talk to a mortgage guy…just kidding …talk to your tax person. Maybe you do your own taxes? Maybe your mortgage guy does your taxes? The interest tax write off might be helpful. Being debt free is great and paying cash you save all kinds of fees and interest however, you might be able to build on that capital faster than you are paying out interest to the bank . Personally ,I would pay for the house in that price range as long as there are other reserves/investments.
Or..you can earn 6k a year towards rent in a CD with 120k.
I think 6k goes a long way in Houston and be certain that you have the 120k to come back to San Diego?
Best wishes