In addition, the capital outlay starts long before any income and the detracting of something from the primary structure even if it is just yard space.As indicated, my original protege made a lot of money (over $500k) on a land transaction associated with a large count ADU development.  

Has anyone found success in turning your primary residence into a rental, buying a new primary with 3-5% down and repeating each year?

Just be mindful the reverse exchanges tend to be more expensive than a traditional 1031 exchange.

Here's my primary reasons:Expenses disproportionately impact lower rent collecting properties For illustration purposes compare two identically designed 1+1 duplexes in the same market.  

Underwriting will assess the performance and appraisal of the property based on traditional long-term rental comps.

I'm finding out that if I make the property my primary residence for 1 yr and then turn it into a rental.

Additionally, you have many borrowers that do not qualify for your traditional A-paper mortgage from a bank and that will definitely not help, as they won't even have the opportunity to buy.

I have a 3/2.5 in Old Lake Highlands near White Rock Lake (~1 mile) that my family and I are living in as a primary residence, but I have been thinking about house hacking into another house and then doing a MTR on this 3/2.5.

Quote from @Matthew Posteraro: Me and my wife are planning on starting our investment journey by buying a multi-family home that we would live in as our primary residence.

Once you do this conversion it will be difficult to change it back to a traditional long-term rental.