I suppose I could combine the two ideas and live in a basement while renting out a 2 bedroom home to a traveling agency. 

If you are living there, then you need to weigh the benefits of having a home, as oppose to renting somewhere else.

Because of this I didn’t state any potential returns… there are too many variables.. would my partner want to live in a unit and run the property themselves and do short term rental?  

I lived in a college town and student rentals did very well as did STRs for parents coming in to visit their children.  

These communities cater to renters who value suburban living but can’t or won’t buy a home.

I could be wrong but I thought I saw that Sacramento requires primary residence for the owner for STR.Do you live in Sacramento or nearby ?

As it stands now, the sweet spot in that area in the market for rent seems to be a little larger 2/2 house with large living area for guests.

Hi, we went live with our first STR (or any rental for that matter) around mid-November.  

As a person who has lived most of my life in metro Detroit, all I will say is be very, very careful. 

They may have a question and ask what the average utility is and I'm very clear that it depends on use but I would always have a cap even if it's 1k to protect yourself if someone likes to live like they're in Antartica during the summertime :)