It really depends on your daughter and her priorities.
On the one hand, I believe it is important to experience freshman year at the university and staying at one school. You make friends and begin to create a network and support system. A university offers a variety of services, and the community colleges really can't compete when it comes to experiencing campus life.
On the other, universities are very expensive and you can get a good education at the community colleges. You can get more personalized attention for those basic GE courses. But your chances at a community college to make close friends that you socialize with outside of school are not as high.
The hardest thing about buying a home before finishing school is that you don't know where you will settle after graduating. She may decide to attend graduate school, which may not be in the same geographical area. She may find a good paying job elsewhere.
Are you willing to help with the mortgage payments after she graduates if she doesn't find a job that pays enough?
Seriously, I would recommend that you use the money to pay for education. College is expensive and if she works and saves money while attending a community college, it still will not be enough to pay for a university education. Unless she seriously reduces her class load and take the extra time to graduate.
Regardless, she will need to work during school to get experience so that when she graduates, she can find work.
