Our rental is in the Tower Grove east neighborhood, which seems to be right on the edge of trendy and dangerous (aka cheap but rising fast...tons of buying, selling, and flipping in the area).

Here is a good article about what happened in Over the Rhine .How Cincinnati Salvaged the Nation’s Most Dangerous Neighborhoodhttps://www.politico.com/magazine/story/2016/06/wh...

Probably worth having a master electrician check all the electrical including outlets and wiring, as there's a good chance you could be looking at rewiring the whole house if it has aluminum wiring, knob and tube, a fuse box, ungrounded outlets, or any other dangerous outdated stuff.  

I was burnt out from cubicle life but that is a dangerous place to start anything.

I have preached until I'm blue in the face about the dangers of buying these low end asset classes and there is enough all over BP but too many people are still getting fooled. 

Agree with @Carl Fischer that you should engage a tax CPA or EA to examine your unique facts and circumstances...However the distinction between who owns the roof is important and determines tax treatment. 

He is a little pushy on sales but he knows alot.He says owning single number units is very dangerous and should not be considered because there are many hidden dangers but you need to get started somewhere. 

Those are 2 very distinct things.

That's not at all how those rules work, and why they are so dangerous in making actual property assessments.

Try to have them invest part of the down payment, to take some ownership interest and be responsible in avoiding any potential dangers.3, If you do want hotel business, then, try to get some with above 100 units, with an above mid-level franchise flag - like Hampton, Holiday Inn, Best Western or other similar ones.