Pretty sure it works in reverse also - set up a Michigan LLC for the property above and you'll have to register it in your state of residency. 

it sounds like you're really eager to deploy a bunch of capital into supposedly cheaper markets, but you're not going to cash flow $500 on a random single family anywhere unless you are self-managing and super hands-on and prepared to deal with rough turnovers.  

The problem we are having this year is that IHA never stopped paying after the last two residents moved out. 

Quote from @Jason Ghent: Hi everyone,For the FHA, what about the case where you live in the primary residence but just rent out the remaining rooms?

How long must you wait before being able to rent out a primary residence property from a lending perspective?

Quote from @Jeffery Campbell: Investment Info:Single-family residence fix & flip investment.

If the water would have came back bad we were prepared to replace the pipe but was told this repair would be around $8K. 

I'm actually considering moving from my personal residence in a somewhat distant future so I was planning to test the waters before making the leap.

Without reserves, they might be unable to evict tenants or prepare the units once they are vacant.

That feature is bundled in a Resident Benefits Package I have as an addon through Second Nature.