That would obviously cost you a lot more than your tax savings, and you would have to trust your 19 year old to be responsible with a huge sum of money.But to your actual question, your son would have to meet the 2 year ownership requirement in order to qualify for the capital gains exclusion on his portion of the house sale. 

For small stuff, you're dealing almost exclusively with local banks, so you either need to find a local broker who knows who will deals with OOS investors, or you need to get on the phone and start calling the banks directly.

Some local newspapers still list deed exchanges.

@Douglas Rice I agree with everyone else that I have been using Zillow and it posts to others like realtor.com and gives you the code to add to craigslist, but I was talking with a friend that has rentals the other day and he told me that he decided to in the new paper a few months back and has found his best tenants through the newspaper ad.

Does it still qualify for the capital gains tax exclusion or will one year be considered non qualifying use?

No taxes will be incurred as long as the property is less than the parents' remaining lifetime exclusion amount. 

@Josiah CollinsTo be a home office- the room must pass the "regular and exclusive use" test.Is it regularly used for business?

I have been researching a lot of deals and this is pertaining to the SC market exclusively but taxes in SC unfortunately are significantly higher for investor owned versus owner occupied (4% vs. 6%) so I’m thinking the taxes paid per month are probably underestimated and this can significantly affect cash flow for a lot of deals in this area.

Would it be better for me to use the 121 exclusion or use this for a 1031 exchange as a result since it has 1 year of seasoning and has been for the past year been used as an investment property?

I invest exclusively there.