Its great that you have saved some money and have a desire but investing involves a risk of loss.

Hiring virtual assistants can save a lot of time, obviously they're somewhat limited on what they can do.

It outlines profit and losses from rental real estate.

-My fiancée and I are planning on having our first kid by the beginning of 2026, so extra room would be ideal as we are somewhat limited in the primary residence. 

If they gift it to you it's tax-free (as long as they're under the lifetime gift limit around 14 million) they may have to file a gift return though, but there won't be tax due. 

If area or units aren't good enough to easily attract sec 8 a lot of these rougher area investments turn into huge losses.

The other benefit to verify is if you have loss protection.

Is that why you’re leaning toward renting, even with a $1K/month loss?

Once you go to 7 beds or more there are much stricter facility requirements, including but not limited to, fire suppression systems, added points of egress, Individual Response System, and much stricter staffing ratios. 

While personal loss is difficult and understandable, running a business that directly impacts property owners requires a contingency plan.