Seems to me there is only upside for them but no share in any downside if the unit is not leased to short term stay occupants.

If you are patient, it will come into focus for you.Best of luck as you get going, and feel free to ask any questions.

Words are free. 

So if you have more than a $786k NET GAIN (not cash, not equity, GAIN) you’ll be able to take the full $500k tax free and then do an exchange on the remainder. 3) For that exchange to work you’ll have to buy an investment, not primary home that costs more than the remaining sales price, and reinvest all the “cash” beyond that $500k.

Feel free to send me a message and we can talk.

As a Pacific Northwest native, I’ve seen firsthand how the region’s unique blend of natural beauty, vibrant cities, and year-round attractions make it an incredible place for short-term rental (STR) investments.

If they’re open to living elsewhere, keeping the property as a short-term rental seems like the more profitable long-term play.If you’re enjoying the self-management and the demand remains strong, I’d lean toward keeping this property as an STR and exploring ways to add another.

@Kristian Forbes Short of doing another house hack or negotiating the purchase price down a fair amount, I think that's going to be a tough one to make the numbers work.

I have a few other options - feel free to shoot me a DM if you want more specific contact info, etc. 

Lancaster city limits short term rentals to only certain zones of the city so definitely look at the city website for that information.