The distinction is that the apartment is in my home.

I distinctively remember the fear of the unknown the first night that I slept in the place on an air mattress.

I moved in immediately downstairs and got to work building two simple closets and a door to make two distinct (and legal) bedrooms on the third floor.

FHA makes no such distinction, up to 4 units you can do 3.5% down.

I only assumed it was owner occupied because the mailing address for the owner on the tax assessor page is at the property itself, which is usually how the city makes the distinction as far as I know.I'm glad to hear you checked out the area.

We can usually do the whole routine of 'move out, move in' in under a week while working our normal jobs for under $1k.The closest idea that I can find is this: https://passiveincomemd.com/buy-one-property-a-year-and-retire-early/(main distinction being that we live in these houses and pay a lower DP)The specific questions that arise in my mind are as follows:Why don't other people do this? 

I haven't had any sound-transmission problems in the duplex, as you might imagine.But way back when I was a student, I distinctly remember living in a cheap basement apartment with nothing covering the exposed joists overhead being forced to listen to all sorts of activity upstairs.

The key distinction that I'm aware of is that PMI is on conventional loans and MIP is on FHA loans. 

One simple way to achieve your goal is to create a new and distinct LLC for each deal that you do with a money partner.

For example, the market (that is, the collection of serious buyers and sellers) for $100K properties is entirely distinct from the market for $1M properties.So, do the math and know your market!