ROI on Master Suite or In-Law Unit in Vacation Destination?

[Jeff Pollock]

Hey Everyone, I'm really stoked to be under contract on a 3BR 1.5BA single family home in Lake Tahoe, CA and I'm trying to figure out what makes the most sense long-term. What really sold me on the house is a completely separate great room and half bath on one side of the ranch style home with a separate entrance. My plan with the house is to have it as my primary residence and house hack the next couple years until I can get into another property, and in the meantime increase the value of the property/get it to a place I can cash flow, likely with AirBnB given the location. 

The question with the separate space is, do I create a nice master bedroom with full bath that connects to the rest of the house, or should I make the separate space into a whole separate in-law unit? In the interest of beginning with the end in mind, I would ideally hold onto it long term, have it cash flow, and always have a place to go in Lake Tahoe when I wanted to. 

If I went the in-law route I feel it would be an easier quality of life to house hack with short term rentals, because I could essentially rent out either side of the house and always have a place to stay. The downside of this would be that the place itself would be less appealing to larger groups coming to Tahoe to vacation that would pay more per night for a 4BR 2BA with master bedroom. I also think that while the in-law provides more flexibility, the route with master bedroom and bath may increase the value of the property more than an in-law and give me more flexibility in terms of exit strategies. Maybe I can create the in-law for the short term and plan to be able to add a door to the main house if I need to open it up down the road to turn it into a master after I move out?

I haven't been able to find any solid analysis comparing these two or estimating ROI or costs to build associated with both, so any help would be very much appreciated!