Let's assume your expenses (mortgage, taxes, insurance, maintenance, vacancy, etc.) comes to a clean $600 and the property rents for $1,000.

You can purchase a primary home with seller financing, then rent out the spare rooms to generate income.

What they are currently using the home for (renting by the room vs renting the entire house to one group) isn't your concern.

There are no laws restricting mark-to-market rents. 

@Aubrey Eblin Thank you very much for sharing your experience with the Rent To Retirement Academy. 

The reason is the rent-to-price ratio is good so you can cash flow, and most of the West side doesn’t have a Point of sale inspection which is really annoying.

If you do it all above board, you would pay taxes on the rental income received and your daughter would be using post-tax dollars to pay rent which isn't the most efficient.

Consider all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.5.

This is more or less like BRRR where I can refinance after renting them out for as much as the cost to build.

I have one in mind at Rent to Retirement.