In other words, STRs can remain and can be sold to other investors in the future3.

Home 1 is ideal for a fix-and-flip loan to fund the remaining $90K, which I can help you evaluate options.

Becoming a property owner.The hardest part about this right now is underwriting deals, remaining patient and disciplined.Outside of that, the actual details of managing the property are only hard if you do not have systems in place, delegate responsibility, and don't fully comprehend what physical asset investments require-- capex & opex heavy.

In 4 or 5 years you will have appreciation and a solid number of years with 2% remaining.  

But if borrowing costs remain high and interest rates don't fall as many people expect, cap rates will have to decompress further. 

My goal is to buy a house in the area and house hack the remaining rooms.

I know you are dealing with a 3 month lease rather than a 12 month lease, but for example....Say I rent my home for $2,500 per month and have to lower my rate by $100 to find a quality tenant that is a loss of $1,200 over 12 months compared to a loss of $2,500 for each month it remains empty. 

Be ready and willing to change locks and give remaining tenants a key3.

Unless new companies move into the city and create replacement jobs, all that will remain are lower-paying service sector jobs.

They shall go to Inspira and remain there (especially with the transfer of the pricing structure) unless Inspira gives me reason to move them.