It sounds to me that Kevin came into a lot of money very quick and was not prepared to handle it properly.

@Jimmy Vance sounds like overkill if they are SFR or small MFR.Only sense to do this with multimillion dollar properties.

In the end do you think this be more cost effective than going the normal route and purchasing one home to live in on the market now.

Sounds like you have the space if you're even considering it so that's a good start.

As easy as this sounds, it's not simple and usually like pulling teeth.

the answer i'm giving is based on the assumption that you do not want to / can not float the negative cashflow any longer. and note: even if appreciation / debt paydown / tax benefits strongly outweighed the negative cashflow, most investors wouldn't want to / couldn't float that. so that said, i say SELL. you have just over a million dollars in equity (minus transactional costs when you sell), and you could do a 1031 exchange into a ~4 million dollar CASHFLOWING property. i invest long distance into value-add multifamily on the west side of chicago. gearing up for my next deal right now. in that price range you could easily get a value-add multifamily with potential to cashflow 15k/mo+++ (up to 40k/mo) once it reaches its full potential. it sounds like you're in markets that are probably strong for appreciation and weak for cashflow (with the long term rental strategy). if cashflow is your goal, 1031 into value-add multifamily in a higher-cashflow area. don't let having to pay commissions during the sale stop you. you're already losing so much annually; you have to stop the bleeding at some point. also note that right now, with the way these two properties are losing money, that might negatively affect your borrowing power when you go to buy the family home. feel free to dm me if i can help in any way!

This strategy is very effective, especially on houses with lots of parking and houses with lots of bedrooms and bathrooms in areas near the popular locations around town.Realistically, you can get $750-900 per room that shares a bathroom, and $900-1100 per room that has a private bathroom.

So it isn't a matter of legalities, but rather how effective is your marketing at finding homeowners who are open to your ideas and offer.

You could get your own license, but don't forget the carrying costs and finding a broker will to take you as effectively a non-productive agent. 

Mid-term lease sounds valuable but hesitant to use capital and effort to furnish it when we really don't know how well that will perform.