If you're talking about building an interior wall to create a bedroom, this could work so long as you aren't significantly reducing living space compared to the competitive rentals. 3 bedrooms with a tiny living area could cause problems.

While this has served me and my family well, it has not allowed me to become financially free. 

By not increasing rent enough each year you're losing money (this is the truth).If they push back hard or say they're leaving, you can always negotiate and back it off a little.

Or if your gut tells you that your family will be happy in this new location, then follow that instinct!

This was a very very good post and honest.. not one of those, well if you look hard enough you'll find a great deal.. no not in today's market.  

This is common in California  Thanks for the reply.

Travel will be part of what I do with this. 

I need help financing this deal.

I plan on holding this property for 30 years (I'm 34) and will live in it for at least 5.

Congrats on this!