I would rent the house to her.

This will help guide your decision opposed to investing somewhere for a novel reason.for example for me it was cash flow, price to rent ratio, land lord tenant laws and availability of multi-families(Just to name a few). 

Some rents in what some define as an A may hold strong values but rents compared to purchase price may not be comparable to a B.

@Ashley Kehr I use a combination of Apartments.com for rent collection, RentSpree for tenant and background screening, and Stessa for accounting.

I am new to the world of real estate investing and want to one day own properties and rent units out.

We accept all applications and in the case of section 8 the only real time we don’t is if the numbers don’t make sense with market rent vs HUD standard.  

Aside from that, there are DSCR loans out there that cater to first time homebuyers, some that even allow those that live rent free to purchase as well.

She asked about $40,000 per month.The "1% rule" says a $200,000 home would rent for $2,000 monthly. 

Charge the tenants a higher rent rate and include utilities with their rent.

I can help you with accurate rent expectations.