@Karl McGarvey - I'm doing a luxury flip in Orange Beach right now, but I do all of my STRs in the Destin and surrounding markets. 

I have seen some decent lots sizes as well to add in an ADU or Carriage Home/mother in law suite. 

With this being said I am not a licensed tax professional and your question is probably best suited for an accountant. 

Luxury property in the Bay Area will appreciate, it just may not happen on your timeline.

I would be concerned about the possibility of them scamming for a future out of court settlement law suit over mold. 

That would be a question more suited to my better half, @Lorien Rollins. 

With 3 adults and 2 kids we could have rented 3 hotel rooms, or perhaps 2 hotel suites.  

Not all PMs are the same.You can also look at buying a place with a legal suite or a duplex-you can live in one unit and rent the larger unit or the unit that will give you the most rent.Narrow it down to a few options and then ask them for pros and cons of each after you've made your own list of pros and cons.   

I recently had a suit I brought settled mostly to my satisfaction and have another suit in process.  

I use the virtual office that Lakeside business suites because I am based in Las Vegas.