In reality, most older homes will cost you considerably more in maintenance, capital expense, and vacancy (people just generally like to live in and rent newer homes).

When analyzing your offer, make sure to factor in operating expenses, rehab costs, and vacancy rates.

What are the expenses (taxes, who pays utilities, etc)?

However, every company I find either doesn't insure non-owner occupied units or is extremely expensive.

An option for you could be to go with a DSCR loan with a reduced prepayment penalty period so that you can get funds soon and if you want to refinance next year or the following due to lower rates or wanting more LTV than you're able to do so.You should look at this one with the mindset of:1) What would my expenses be once I refi vs what they are now?

The areas you are looking in are a step below the most expensive so I have no doubt they are higher, but you are also looking at a small sample size when you only look at homes available for sale now.

As I see it in the current market, STR is now a way to get a really good, appreciating asset to pay for itself, not a way to produce a meaningful amount of cash flow after all expenses. 

I had assumed it would be beneficial; just seems more expensive.

@Christine AledamIf you create a California LLC, the $800 cost is a tax deductible expense. 

This will have a higher expense buy may very well be worth it for your listings and companies health and growth.