If we were to make more than three loans per 12 month period secured by properties in AZ then either we would need to hold an Arizona commercial mortgage brokers license, or we would have to make the loan through someone licensed as a commercial mortgage broker by the state of Arizona.Any more detailed or technical questions would probably have to be answered by legal counsel knowledgeable in regulatory licensing in the state in question, or the state licensing board itself.

As far as calling it a duplex or apartment just explain in the body of the ad.

Like revenge body skinny.

You'd look for folks who are downsizing, who may have lost spouses, but are still able bodied.

If you converted your SFH to a duplex, were there any unexpected problems/surprises on the legal/regulatory side, like being unable to rezone the property or get a rental certificate? 

As close to the road as that is it would be visible so a building inspector (or busy body neighbor) could easily turn you in for violating building code and then you'd be forced to remove it at your cost.

One wouldn't expect Abilene to have issues with flood zones since we're nowhere near any big bodies of water, but if you've driven around town while it's raining, you know! 

Regulatory burdens are likely to go up, and I think asset prices will remain artificially high due to loss aversion.

This is a huge topic, @Vincent Billera, and one to which the response has dramatically changed in the last few years.Prior to regulatory changes, unless you knew the right people (colloquially were a 'member of the right country club'), you were shut out of the option to invest in anything but that which you can personally afford.  

The databases often have inaccurate or outdated home information, and are not able to take into account value-heavy features such as floor plan, neighborhood, exterior appeal, interior flow, kitchen and master bedroom space, interior light, ceiling height, yard appeal, proximity to features that are positive or negative (park vs. apartment building/auto body shop), plus condo dues, amenities, and/or litigation status, along with many other things.