This will allow for him to at least get 100k.

(Social security, pension, 401k, etc)It is hard to retire on $350,000 of net worth.Even if that is generating 10% cash flow, you are talking maybe $35,000 which is $17,500 for each person.I personally like the idea of seller financing a home at that point, potentially exclude the gain on sale if it was their personal residence and get a nice interest return.If the house is big, it also allows them to downsize the home when they look for something to rent.

I personally think it really depends on how much value will it add to the property and if the town will allow it. 

Finding a condo that allows Airbnb/STR will be challenging, they're rare and cost more because of it. 

House hacking could be a solid option, allowing you to offset living costs while building equity.

You’re going to deduct the rental mortgage interest against your rental income and your personal mortgage interest (if allowed and more than standard deduction) against your regular income.

What documents do they require, what credit scores do they allow, how do they verify previous rental history, etc.?

The approach involves using a hard money lender (HML) to fund 75% of the purchase price while having the seller carry back 25% in a second-position loan, allowing you to flip the property with little money down.

The City of South Lake Tahoe does not allow short term rentals.

If yes, then the other partners can just do a JV agreement internally which you can record at closing that allows you to still “partner” up on it but allowing the lender to still be protected if anything goes wrong with the deal or people borrowing.