I'm sure there will be others with their own (and possibly conflicting) opinions, but for question #1, I always advise my clients to focus on properties in areas that 1) they currently (or previous) live in/near, 2) they travel to frequently, or 3) they have family/friends in the area.For question #2, the answer is going to depend on what you do for #1.

We are getting conflicting answers on this.  

Then, if your a member of NAR, you better check on that and make sure your not making conflicts there. 

Sadly, both of them escalated this conflict and started creating domestic disturbances so we had to move both of them out.Assuming the upstairs family is being reasonable, I suspect no matter what you do, the people downstairs will never be happy.  

Ineffective or Absent Conflict Resolution ProcessEvery successful group of people needs an effective conflict resolution process characterized by:simplicity to understand and remember;quickness to start and complete;a clear vocabulary.My company, Livingsmith uses and recommends the 5-on-5 Process for conflict resolution in co-living homes.2.

I am conflicted on whether to use the 500K on one big property (ideally multi-unit) or buy several smaller properties.

I am obviously conflicted with the moral side of pursuing legal action here, but understand that people can do untruthful things when it comes to financial gains. 

im in Orange County CA and there is a huge market here for room by room rentals here. i've been doing this for quite some time (over a decade now), and it certainly has its pro's and cons. my advice if you go about this is make sure you do proper vetting before moving someone in... not only for financials/ credit-worthiness, but also for temperament and expectations in a co-living space. we ask a lot of questions like "how do you handle conflict?"

I plan to manage the properties myself until it conflicts with my regular job.I would appreciate any advice on these markets to ensure success and connect with local investors.

I have a STR in Truckee that has done very well and I am looking for another STR, was thinking of the Sacramento market but I hear conflicting info on the permit process and the ability to rent it out for more than 90 days a year as a STR.