We are planning to purchase a home and convert it into a community living space for people in recovery.

Buy and Hold investing is a great avenue to begin with as most people live their lives off of residual income. 

In the case mortgage foreclosure, I usually offer to pay for the existing mortgage and give them a little extra to move.

You may also want to consider buying this as a primary and living in it for a year.

,I have sold and been managing properties that are near the MIA and haven't had any complaints from residents who are living in them.

If you live paycheck to paycheck and do all this you are never going to become an investor because you aren't willing to change your lifestyle now for something you can have in a few years.  

The FHA rules/regs (in particular the FHA self-sufficiency test) are applied the same across all markets, and I know for a fact that in rural communities across the country, and big cities that are not particularly desirable places to live, it's not a deal-breaker, I am not commenting on those areas. 

Better sell everything and live in an underground bunker. 

You have multiple people living in each others spaces.

I live in Cullman.