However, please note that the elderly, disabled and children have some protection over a owner move in eviction.

Their children are lawyers.

Our local tenant laws say no more than 2 persons per bedroom, except for children born during tenancy.  

When we arrived we peaked in the windows and you could see a bunch of ratty looking furniture (odd for staging I thought).

it seems as if option #1 allows you to quickly scale with less money (basically furniture and a security deposit) but has the downside of lower margins since you're not building equity.I've also thought of other ideas such as buying a few properties under a llc with several other investors, where the total cash per person would be the same as if you bought 1 property by yourself but it's diversified across different markets and reduced risk.

There are parents/sisters/friend/grand children, total 6 adults 4 children. 

You cannot choose to rent to them because they have small children.  

To be able to have my children be a part of my team when they grow up and pass it along to them.

We have three children so we would have to have a decent flip home to live in while we get a few projects going. 

All occupants should be on the lease,, minor children are listed as such,,, John Smith 1/1/2017 minor child.. so date of birth verifies they are minor child..