For rentals, they can work well if the HOA is investor friendly and cash flow numbers make sense.Financing can also vary, so it’s worth checking lender requirements for condos (warrantable v non warrantable) versus SFRs

Basically the city sends their own inspector out who compiles a list of items that are required to be fixed usually within 3-6 months of taking ownership. 

That's too much effort required to earn a few dollars on a short-term stay.

At the same time, I am also using this opportunity to move that capital into an LLC, and would look to extra financing to purchase a new property or properties of equal or higher value (per 1031 exchange requirements).

Investors normally get there payments on time, most of the tenants stay for long periods of time because if they move it is a hassle for them, and since section 8 requires that the property stay in certain condition it will help keep the maintenance costs down. 

We would greatly appreciate your guidance regarding any requirements, limitations, or recommended procedures in this context.

Buckets are the credit/exp requirements for leverage and rate. 

The finding can be quashed if the U&O is clean and the municipality doesn't support the inspector's finding, but that might require some court action.

So its definitely not a "hack" and requires a lot more work then other marketing channels. 

Quote from @Raghavendra Jakkani: The tenant should provide proof of income that doesn't require detective work.