I have my primary residence single family home paid off in full Zestimate ~$500K, and no other outstanding loans for cars, schools, credit cards, and in good financial position with 2 years of reserves for expenses, etc.

I require all new tenants to use it, but I have a few that use other methods due to them being tenants when I acquired the properties.Background and credit checks are easy to send to an applicant - they pay 55.00 and I get the reports quickly. 

It's a great way to get started on building your portfolio without having to put down a huge down payment and it's not as time consuming or expensive when it comes to management as you will be living there. 

Would it make more sense to live in old side and work on it while living there and still make rent on other side while losing out on being able to claim expenses as tax deductible or live in updated side and loose out on rent for about 4-6month(1300/month) but be able to claim all expenses as tax deductible.

Is a license required where you reside or where the property is?

They will know your companies requirements and guidelines.  

That is 5% of rent for Vacancy, 5% for maintenance/repair, and 5% for capital expenses.

I believe someone above said they aren't that expensive.

Lenders usually require 6 months in reserves / savings for property mortgage, taxes and insurance.

I might also increase the requirements tenants must meet to be approved.