Hey Fisher,Yes, you can live in your garage and rent out rooms in your house, provided that the garage is properly converted into a habitable living space according to local building codes and regulations.

It can be a negative factor if there's increased traffic/noise or if it blocks off a view. 

There is a time factor that needs to be accounted for as well.In my opinion - you will need to be able to reasonable achieve 2-3x the rents vs. the alternative for room rentals to be worth the squeeze.I'd check to see what other folks are renting individual rooms out for to see if it makes sense diving into.

I am looking to build a SFR for short-term rental, would be my first-time new build.I have engineer plans for well and wastewater stamped by the state of VT for up to 4 bedrooms.

I have a builder who builds 4 BR with two Primary Suites and has a lender deal right now. 

But you have to be a good salesman, you have to do your market research, financing research, and also build yourself a pipeline into the opportunity of whichever market is chosen.I have a Canadian client who runs things that way. 

In theory this would hopefully reduce my monthly rent costs and my payments would go to the new 2nd property to build equity.

what if the spec level of the build you are entitled for isn't what the users need?

I would love to connect with people in the area to get conversations started and build connections.

Nathaniel, let's build you for success.