On top of that, what if all of a sudden you need a new roof, or windows, or a sewer line, or the irrigation system freezes, leaks and floods the basement, or a fire guts the place and your insurance only covers some of the vacancy/rebuild costs, or a flood washes it away and you didn't have flood insurance, or your tenant stops paying and their estranged lover/stiffed drug dealer breaks in and destroys the place, or any one of a myriad possible bad things happens because you have an investment that hinges upon human behavior, and therefor needs constant baby sitting, and 5 years of your glorious $500/month is wiped out in one afternoon, and the bank takes the property?

And rehab and treatment of back willbe more expensive than not having a job.

You are correct that the tax treatment of Airbnb business (emphasis on "business") is distinct from other forms of real estate investment - and that you should get clarity about that to incorporate into tax planning and investment ROI analysis.

Like many military bases the surrounding town is normally small rinky dink with civilians trying to take advantage of military members (loan sharks, auto dealers, gang members, and drug dealers)  Your properties will probably be relatively stagnant due to it only being a military base. 

Rul. 8429039, provided that a two-year holding period is sufficient to ensure treatment as a tax-free exchange (all other tests being met). 

Now 1031 exchanges may only be done on investment real estate.What still has to shake out is guidance on what the difference is between equipment and fixtures that remain personal property and so are excluded from the 1031 exchange, and equipment and fixtures that become part of the real estate itself and so eligible for 1031 treatment.

In Florida, Teen killed in motorcycle accident  ( highly suspect that his plan to claim on insurance went awry and strong prescription painkillers involved).Single person occupancy and he was the only person on lease.He was in the midst of moving out, but left behind starving animals, drug paraphernalia, junk.Now multiple strangers are driving around and selling off his 6 vehicles and have been staying in the house after his death. 

If someone were caught drug dealing in 2010 but finished their sentence in 2012, that would give them six years of history to prove they had changed their ways, which should be sufficient for any Landlord.In your case, the guy was honest and admitted his mistake.

Make sure they are rock solid in every way, rented, then repeat.....or steal the million and piss it away on drugs and hookers.

For example, repeals of the current annual property tax increase limits, or even limits on rental income or its income tax treatment in the state.