The only options that seem available to us are add the parents to our application, remove either parents or wife from the duplex, or in the future put the rents all in my wife's name which might negatively affect my in-laws.You guys are my Hail Mary, hoping you can spot a solution I'm missing!

Flipping homes is still a s option.

I've drawn the new build for an owner-occupant to have a single family home but with the option of having a "tenant"/roommate or family member (perhaps in-laws, or elderly parent/grandparent, or a brother/sister, who wants private, separate living space, etc.) living in their own space with their own separate utilities.

People live there because they have no other options.

Check to see if there are any purchase + rehab options. 

If possible, I would suggest looking into negotiating a cash for keys option. 

Reserved the land but then now knowing what to do, gave away the option on 1st

@Mimi PerezThe restrictive HOA will limit your future options and continue to be an expense.

That's also an option to temporarily bridge the gap of quitting a full-time job.It's also important to be making enough on your properties so you're cash flowing enough so you can buy more property - sounds like common sense but as mentioned you can always freelance or do something you enjoy part-time to bridge the gap in pay.

When you're weighing investment options, think about things like employment growth, rental needs, empty property rates, and property taxes.