From a credit perspective, house hacking also helps you build strong cash flow, which can make it easier to secure financing for future deals.Additionally, if you're targeting high-appreciation markets, you could also look into cash-out refinancing down the line to pull equity and fund additional investments.

Quote from @Lionel Quiambao:  ... and maybe throw in the option for the tenant for more speed at an increased rent to cover the additional payment. 

My original SFR was 1100sf and I added 2 units: an 800sf SB9 unit and a 750sf ADU (converted garage plus addition).

This strategy involves holding the properties for the long term and profiting when you sell them.Here are some additional factors to consider when choosing a real estate investment strategy:Risk tolerance: How comfortable are you with risk?

Additionally, in the R-7 and R-8 Zoning Districts, you need a Conditional Use Ordinance from the City Council to authorize the conversion.

This combined with my new boss giving me additional responsibilities (how dare he...) and the support of my wife prompted me to take the plunge. 

Next, arrange a site walkthrough to pinpoint any additional needs or potential challenges.

Are there additional factors you think are worth considering?

In addition, committing ~ $200K requires some level of sophistication on the part of the investor and you are more likely to find someone to agree to your terms in smaller transaction sizes, but even that will be difficult. 

We have not disabled ours or converted to gas, but Tenant must sign a Fireplace Addendum stating if they use it, we require a higher renter's liability policy with us as additional insured, rules on wood, storage, use, safety, they pay for yearly professional cleaning each year they are there, etc.