When looking into it, the basement had water damage that didn't worry us since we knew how to remodel that area ourselves.

You may have a 1M policy, but 25K for mold limit.Cracked water pipe MAY be covered.

I would build the big house and do a cool deck out towards the creek.

I know it can feel like uncharted waters at first.

In one of the 3 fundamental human needs (food, water, shelter).

From what I've seen, the days of the $1,000 and $2,500 deductibles for fire, lightening, water damage (not flood), etc. are becoming harder and harder to find. 

.- Tenant submitted a work order for low water pressure in 2 bathrooms- Tenant submitted a work order because the garage door doesn't close all the way and left a 2-3 inch gap at the bottom- Owner initially refused to address either work order- Owner demanding the tenants place furniture pads on each piece of furniture- Owner calling multiple times to speak through the work orders, asking when they've been scheduled, calling a couple days later requesting the invoices- Owner calling because they want to access their storage in the basement so they can remove several pieces of furniture being stored- Owner now emailing requesting multiple property inspections throughout the lease cycle- Owner questioning my experience and relative PM knowledge because I'm not following up with her in a timely manner (the following day after the work order)Keep in mind, this is 2 weeks after the tenants had moved in and the tenants are very happy in the home.This is something we see on a regular basis.

In Oceanside, New non-hosted STRs are prohibited outside of the Coastal Zone as of February 10, 2024.Most HOA's do not allow rentals less than 30 days so that is likely not an option unless you find a couple of places on the water that allow it but usually tough to find below $1M. 

Interested in getting some extra income with converting the extra space in the basement into a rentable unit.Basements in a one-family home can be lawfully rented only if the following conditions are met:Compliance with the Housing Maintenance Code for minimum room size.There is a minimum ceiling height of 7 ft.The walls, as high as ground level, must be damp- and water-proofed if HPD determines that subsoil conditions on the lot require it.The basement is occupied by one family and does not include boarders.Every room must have at least one window.The bottom of any yard or other required open space cannot be higher than six inches below the window sill of any required window in the room.

Naturally, he made a cool $1k!