That's a potential of 5 - 6 months where the tenant doesn't have to pay me a single dime and will be squatting in my house for free.

EDUCATE YOURSELF - yes, it will take time, but will lead to a selection that better meets your expectations & avoids potentially costly surprises!

Hey Santosh,As of right now you're extremely exposed regarding insurance and I'm going to assume legally as well.If the home isn't registered as a legal multi-family with the town that's something you'll have to correct ASAP and make sure the home is up to code.Insurance wise as soon as they find out what you're doing they'll cancel you as the risk has changed from a single family owner occupied home to a multi family owner occupied home.

@Kash Tacke I'm a big fan of ADU's in general especially here in the mid west, yes you could potentially be on the front of the wave, but housing density is the solution to the affordability issue, anytime you are investing with affordability in mind is a great strategy to me, and sound like there are some incentives or at least supporting winds form the local city, that in itself seems like it would be worth at least approaching an architect or contractor to bid up some plans or concepts to take tot he city.  

If you have steady, high income in a coliving house I think that’s potentially more profitable.

Differentiate between different risks , economic risk, structure risk, incentive risk, etc.5.

Hey @Ricky HernandezGreat question, and it’s awesome to see you thinking ahead about the potential for turning your new-build home into a rental.

This was in a middle class neighborhood and I get why that is less risk however with apartments increasingly including laundry, I would imagine demand lessening in that location. 

In your scenario you'd have a potential tax event on that $200K difference.Here's a creative way to access most of that money tax free however. 

I have a commitment to invest in rental properties, meet professionals  & eventually meet potential business partners!