Your income isn't high enough for it to make sense as a rental and the closer you get to your residence limit the greater pressure you will have to sell it before losing your exclusion in whole or part. 500k right now can make $15k per year income with zero maintenance or tenant risks. 

Investment Info:Single-family residence hard money loan investment.

Investment Info:Single-family residence hard money loan investment.

.: Same exact thing happened to me.

Investment Info:Single-family residence fix & flip investment.

I could be wrong but I thought I saw that Sacramento requires primary residence for the owner for STR.Do you live in Sacramento or nearby ?

Patience is definitely needed if you are trying to buy from a resident with no real estate experience.

It would be his primary residence so most likely a duplex or triplex house hack. 

The violations would include 'the personal occupation of a garage as residence' while asserting to police that he didn't live in it, along with the power overloads due to use not in keeping with a garage rental.  

I would tell people today that if you buy a primary residence expect to stay in that home for atleast five years, especially with a FHA loan which has lower down payment as the current forecasts for home appreciation or very low which with closing costs on the buy and sell, it will take several years to have equity in the property and enough to be able to sell, so that is something also to consider.