After brushing up my leases and thinking more about I am wondering if this puts me liable if there were to be a CO leak and it were due to detector malfunction from the residents.  

Possibly a co-singer but even then you would have to chase down your money.

If they can't get a co-signer from one of their relatives, then that likely means their relatives don't think they're going to pay you either and don't want to get stuck with the bill.

As to insurance, there are several ways, you can be added as a co-insured, you can be listed as a loss payee (but doesn't insure you) you can be indemnified of insured losses through you contract with an assignment of loss proceeds.

I say this because its the little things that add up when you go to get a CO (Certificate of Occupancy) to sell the home.  

If your son is a co-owner of the property (joint tenancy or tenant in common) and lives in the property, it satisfies the owner occupancy for high-ratio / insured mortgage programmes.  

Otherwise you could set it up as a woodshop and treat it as a co-op or maker space.  

I just required a co-signer with both going thru all the credit, background, etc checks.  

Generally speaking a lender likes to make a loan to someone that shows they can repay so most likely they will be signing as a co-borrower.

Most lenders will look at the asset more than you, but if you don't have a whole lot of experience, then they may ask you to put up more capital, find a co-sponsor/signer for the deal, etc.Feel free to get in touch if you have more questions.