I am exploring options - sell his place, use is as a rental or take some equity out if it to purchase another property (I was thinking maybe a short term rental on the lake)?

Make sure you do your research on comps.

Owning in an SCorp is not for all lenders, but plenty of lenders are ok with this holding type. 

Steps to PrepareGet Market Data: Research comparable sales to determine the property’s value.

This aligns with my interest in passive income.I realize I am not cut out for the entire REI process of consistently finding multiple properties for particular exit strategies.

First off congrats for looking into this realy estate stuff at such an early age! 

I have been investing in the stock market for 5 years and I am now transitioning over to real estate after doing my research on real estate for the past two years. 

I'm just new to this world and wonder what someone with some experience would do.

This vary heavily town to town. 20% down is great if buying strictly as investment but if you have a way of owner occupying I would explore that route and apply the 20% down to increasing value of property and instead using low money down loan. 

West Valley cities like Buckeye and Avondale, East Valley spots like Apache Junction and Mesa, or growing areas like Casa Grande and Maricopa are worth exploring.