The third option (like bottom barrel) would be to continue renting and save for bigger downpayment and wait for interest rates to come down more.Financially we are in place to buy a home comfortably under $400k.

I would also let them know you no longer feel comfortable hosting this guest.

While each market - real estate and stock - has it's own risk/return profile, the comfort of owning a cash-flowing hard asset becomes more and more appealing when the stock market gets choppy. 

Are you comfortable working with your CPA remotely?

Not sure what kind of rehab you are comfortable with, but I have seen deals in these areas under 200k. 

It's the closest city outside California and with the 4th lowest property taxes in the Nation, no state income tax, and landlord friendly NV is a great environment for investing.

For my own sake I wouldn't be comfortable walking away without at least 20-30k in personal liquidity in a 4-5% credit union acct.

- Nobody in here is comfortable answering this question. 

This becomes especially critical in the current environment where you can earn 5% on your money easily and aren't tying up cash until the project is completed.2.

I was still looking for homes I would personally be comfortable in.