I know we need to learn more first, both about financing/liability options and about rental/lodging laws. I understand it requires significant time investment. I have hospitality experience (was an innkeeper earlier in life) but none yet in home maintenance/construction (although I am reasonably handy). Ideally, something like this is where we would want to start (it may not be practical now or ever, but it is what we would like to consider and research further):
- Buy a 2-3 family house in Virginia or New York (outside NYC). The location would either be one of the cities in Virginia where we have close family (and visit regularly staying in AirBnB rentals) or it would be within a few hours of NYC (near hiking areas we like to visit). From looking at listings for the kind of properties we have in mind, I estimate the purchase price (and immediate renovations if needed) would be in the range of 350-550K.
- One unit would be rented to a close reliable relative at below-market rent in exchange for property management duties. One unit would double as a vacation home for my family (me, husband and 2 kids) and a short-term rental. If there were a 3rd unit, it could be either short or long-term rental.
- If the relative moved or became unable to fulfill duties, we would hire a local property manager. The plan would be to set everything up to be flexible and easy to convert units back/forth between short and long-term rentals as needed (and possibly to convert between 2 and 3 units easily, depending on layout and zoning laws).
- Ideally the property could generate enough rental income to cover the mortgage and all expenses. But we might even be satisfied if rental income simply covered mortgage interest, property tax, and maintenance. I think we could live with the down payment and principal payments serving as (1) the cost of us having a vacation home (with a relative who can babysit - quite valuable to us!), (2) the cost of providing affordable housing to a relative whom we are likely to start subsidizing soon anyway but aren't ready to live with full time, and (3) as an investment, with obvious risk.
So Bogleheads who have rental properties, what websites/message boards/analysis tools/etc would you recommend?