Wow why feel any pressure to go to work.

Ergo no upward pressure on values.As Anish note's there is no land to speak of to build on in the Bay Area.. 95% of the land that can developed has been developed so what you have now is a huge tear down and rebuild industry.. heck we were doing this in Palo Alto when I lived there in the mid to late 80s.I am currently in Singapore and if you think prices are high in CA... here a 900 to 1200 sq ft apartment in a condo tower will run you 1 to 2 million... and in the nicer buildings 2 to 4 million.. 

It is very high pressure and not everyone can do it.

And as they do, they put upward pressure on our housing market that was built for a much smaller population. 

There is no such thing as an American who cooks using a set of burners and conventional oven regularly and yet is wholly ignorant of the uses of toaster ovens, tabletop convection ovens, digital pressure cookers, slow cookers, hot plates, induction burners, etc.So everyone has to put their big boy pants on and agree to fix this together.

I have been exploring rent by room lately and happy to exchange the knowledge.I will start with some gotchas:Lease: Two ways this can be done 1) Master lease and put each tenant on the lease, that puts peer pressure on everyone to pay the rent, keep the property clean etc. 2) Lease separately for each room, flexible renting and everyone isn't bound to others' wrong doing, tenants might prefer this.Utilities: Three ways I have seen people managing utilities 1) Include average utility cost in rent and take care of all utilities yourself and have a cap at max utility after which tenants chime in 2) Utilities are paid by tenants but that could cause issues when renting by room and one person is overutilizing electricity etc. 3) Fixed cost of utility charged to tenant monthly and anything beyond that is paid by landlordProspective tenants for rent by room: 1) Students attending nearby colleges, put all of them on one lease and have them find roommates, put their parents cosign the leases, 2) Traveling nurses, they're catch all when comes to rent by room but usually short term, 3) Rent out by room to any individual professional, this creates more management overhead but keeps vacancy lowCommon Areas: Try to setup such that common areas are avoided by tenants as much as possible.

This puts more demand/pressure on the affordable housing space which already has massive demand and a supply shortage. less competition!  

An area close by (Newburgh) has a popular college (Mount Saint Mary College) where students opt to live off campus (similar to Albany). 

I really like areas such as Dormont, Mount Washington but wonder if that would be catching lightening in a bottle.

You will already be struggling to keep everything together your first couple deals, do you want to have the pressure of the bank, the market, struggles with the renovation, and then another person breathing down your neck to return their money?