The federal government comes out with specific tax laws and it is up to the states to conform to the tax laws or not.California, unfortunately, is a state that does not conform to a lot of the favorable federal tax laws.

From a purchase loan perspective, with any conforming mortgage you are not going to be allowed to have your down payment be anything but guaranteed funds that are verified as yours or a gift from a family member.In other words, in order for this to legally work your parents would need to give you the funds required and a signed note saying they are not expecting repayment of the funds and that it is a gift.

If you plan to use a conventional conforming loan, those can only be made in your own personal name.

So BP would call an FHA loan conventional, but an actual mortgage professional would not.BP would not call DSCR a conventional loan, but an actual mortgage professional would.BP and an actual mortgage professional would both call a primary residence SFR jumbo loan conventional (but a jumbo loan is not a conforming loan). 

It worked well for him because he lived for cheap, it worked for me because he paid me.There's not a wrong way to do it, but personally I look to maximize my conforming loans because the terms are amazing and we only get 10 of them.

Normally I'd look first to stay local, but I haven't recently seen anything attractive that could be purchased with $200k cash or $800k leveraged with a conforming loan.

Understand their underwriting requirements, they may not conform to the "50% rule" you referenced.Do your research of the different condo complexes.

It comes down to zoning and what is conforming with the area.

He is also an investor and understand the non-conforming loan side of the business. 

(Take out the way off variables like "political beliefs, crazy cat people, or any other sort of non-conforming oddballs that you meet from time to time in the rental world.)