It’s crucial to have a solid agreement to mitigate these risks.The Ugly: Without clear agreements, co-ownership can lead to legal battles, credit issues, and potential loss of property.By carefully planning and seeking professional advice, you can navigate this situation effectively and find a solution that works for you and your family. 

I wouldn't take a loan on the one you own outright yet because you will mitigate the cash flow.

I use a property management company and am umbrella policy to mitigate risk.

There are some things you will want to think about before purchasing in the area - insurance, fire mitigation, etc.  

BUT you can mitigate that by buying outside of an HOA and a newer home which will give you more affordable insurance. 

Perhaps my son being one of the tenants will help to mitigate the damage?

This can help mitigate potential damages down the road. 

You need to mitigate the capex, the tenant risk by consolidation of units & higher quality placements. 

I mitigate some of this risk by relying on section 8 exclusively going forward. 

Because than that Brokerage brand can spread those cost's out over the big pool thus mitigating those cost's down.