In CA you can only deduct for rent, damage, cleaning or personal property (like keys or furniture):http://www.dca.ca.gov/publications/landlordbook/se...You also can't have a separate deposit for utilities. 

You furnish the common area in the basics and they bring their bedroom furniture.  

Kitchen cabinets, countertops, furniture and others.

My insurance definitely paid for the damage to both houses, no actual damage to the property but I think one of the cinder-blocks smashed an A/C unit, and another damaged and awning and lawn furniture next door.

Or the tenant might have brought in some "new to them" furniture that contained the bedbugs.

I have had that happen to me.I just texted and called a bunch of times to see if they had moved out since all their furniture and everything else was gone.

Put 12k in furniture on each side.

With my second and third properties I posted the realtor listing photos and noted that new furniture/photos would be in place by the time any guests arrived (both were sold to me furnished).  

So far we have not gotten ANY actual applications.On side note our Realtor suggested we convert back to a 2 bedroom by turning a bedroom into the living room and opening up the doorway to a walkway to allow furniture to get into the room easily.  

Roommates breaking each other's things (or your new furniture), stealing from each other, claiming theft/assault/etc. to get out of leases, etc.Why on earth would YOU want to be responsible for finding roommates who are complete strangers to live together?