Use the funds to buy 1 -2 LTR rentals cash or use a loan and get 3 - 5 LTR's.

@John Brown Running a short-term rental (STR) on a subleased property, often called rental arbitrage, is feasible but requires careful planning.

I agree with Collin.At the very least, you need 2nd home, "vacation rental" insurance.

A second consideration is that condos locally have become more adverse to rentals. 

Insurance costs have been crushing cashflow on a lot of rentals as well - I've seen HOI quotes on $200k-300k houses come in as much as $200.00/month over expectations.

As a starting point: -If they work full time and make $700k a year -Don't want to or can't spend time self managing a short-term rental -Don't have a spouse who wants to take the lead on managing the rentals They are likely not going to directly reduce their taxable income with real estate year-to-year. 

@Kavya VeerapaneniThere is a market for short term rentals in Danbury.

@Matt PowersFrom my experience, deciding between short-term rentals (STRs) and long-term rentals (LTRs) depends on the market.

South Carolina (where I live) is a great state for many things but not rental real estate.  

Verifying last 2 years of rental history very important!