What are you thoughts on STR changing local regulations? 

However, it’s important to weigh the benefits against the obligations and regulations involved in the program.

Forming a Homeowners Association is a good idea, but can a HOA legally enforce rules and regulations on neighbors who do not comply?

Understand Local Regulations: Dont forget to do your research.

Of course there are nuances like everything regulated by the IRS but like I said it's basically not that hard to stay in compliance. 

Since you are the sole owner, you and your friend cannot elect out of filing a partnership return (see Regulations section 1.761-2).

A couple questions.. what are the regulations associated with doing this?

Check the regulations of the area since Memphis has some areas you'll need to avoid.

You'll need reliable local contacts, such as property managers, contractors, and real estate agents.Regulatory and Legal Differences: Each state and municipality has its own set of real estate laws and regulations.

Stay Inquisitive: Keep learning and staying informed about market trends, regulations, and best practices in real estate. 2.