In other words, should we do the rehab/upgrade stage while owner occupied or in rental phase?

Far too many get stuck in the "paralysis by analysis" stage, thinking they just don't know enough to get started.

Far too many get stuck in the "paralysis by analysis" stage, thinking they just don't know enough to get started.

This is a snippet from an article written by Onera Group.Short-Term Rental Analysis in Okaloosa Island, FloridaThe base of our short-term rental analysis is outlined below:First, we will identify areas in Okaloosa Island that consistently experience high demand for short-term rentals year-round.Next, we will narrow our analysis down to a specific subarea, considering factors like occupancy rates, average stay, daily rates, and annual bookings, among others.Then, we will identify the precise characteristics of top-performing listings in this subarea, including property type, number of bedrooms, bathrooms, key amenities that drive demand, among others.Next, we will reveal how top-performing hosts in this area adjust their daily rates throughout the year, capitalizing on the seasonal trends in the short-term rental market.Finally, we will conduct a financial case study to determine the expected net annual return of a listing available in the for-sale market within that specific area in Okaloosa Island.Analyzing High-Demand Locations for Short-Term Rentals in Okaloosa Island, FloridaThe first stage of our analysis involves finding areas with high demand for vacation rentals on Okaloosa island.

And unfortunately if the deal gets to this stage the original seller is getting their credit hammered unless they are making the payments when you are not. 

If something goes wrong out of state you cannot see things on the ground, have zero knowledge of the area, and are utterly dependent on people who get paid by commission to give you honest, disinterested, descriptions (up front as to what you are buying) and advice. 

I always look at house hacking vs. renting, not from a cash flow perspective but just simply whether or not I am paying less rent than I normally would be living in that area.The better question is when you move out in a year or two will it be positive so that you arent coming out of pocket as you move forward...No matter what buying in good areas will always be a great move 5-10 years from now...you just need to figure out if you can out last the beginning stages.

Now here we are, and I’m just trying to figure out how to move from stage one to stage two.

These are the tough conversations with sellers you have to have when they let their parks and trailers deteriorate to the point of utter distress. 

At this stage, based on your post, you would wait until its listed then contact the listing agent to purchase it.