I don't think you are going to be able to get insurance for two separate living units in a single-family when they are both illegal and likely do not have the correct egress windows (basement) for fire safety which could subject you to huge liability if something happens to either party.

if you are worried about vacancy, then multi-family is what you should go for.

Investment Info:Single-family residence buy & hold investment.

I don't want the opportunity to pass so I'm reaching out to family and friends who would potentially want to invest too.

Another single family house had two front doors and they assumed it was 2 units, it was not. 

Does anyone know, or have a good idea, about the difference in returns on entitling & developing the land for each scenario, with final objective to sell to a builder to build and sell the structures him/herself. ...

I'm also open to discussing the properties I have purchased, analyzing which deals have been successful and which ones have not.In my experience, out-of-state investors who buy single-family homes in the suburbs usually see better returns.

Consider house hacking when rates and prices are a little more balanced with reality.I would prefer a duplex/triplex but I know getting into a single family home and renting out the rooms is more accessible .

I now live in Indianapolis and work exclusively with OOS investors, particularly those investors looking to acquire cash flowing small multi-family and/or short term rentals.

It's a 4 family, I just don't want that kind of transactional relationship with any tenants.