This is rough math so don’t get cute and tweet at me all the little things we don’t account for.

I will post some compliance resources below...Business Operations Tax (BOT)If your property falls within the Sacramento city limits, in order to operate your property as a short term rental, you will be required to have a Business Operations Tax account with the city.

However, in accordance with the lease terms which stipulate the tenants' accountability for foreign objects, I made it clear that subsequent instances would result in a shared financial burden.

My opinion if it were me is if I had a network of people/vendors(family members or friends to keep an eye on it, contractors/handyman if any repairs were needed, a re agent for showings if needed and so on) and a online software for collecting rent etc then I’d be comfortable managing from a far.

Every accountant thinks that knowing the numbers and taxes is what makes a deal work.

So the above, is directly in response to your question/strategy BUT, I would certainly consider NOT SELLING THE LOT NEXT DOOR... especially since you said you're seeking 'additional cash-flow' -- if you sell, it won't be recurring cash-flow instead it will be a one-time infusion of cash into your bank account and then its done AND you won't have much control on what happens next door aside from what restrictions you have placed in the deed... why not instead of selling consider... offering it as a 'ground lease' whereas, the person seeking the lot is allowed to build on the lot but then will pay you rent for the use of the land... this would be similar to some commercial agreements or even mobile homes where the tenant owns the structure but you own the land on which it sits on.. it's also quite similar to how McDonalds and some other franchise businesses operate it's how they are able to ensure that the properties being built are built and operated in accordance with their vision, if a tenant does not build it or operate it 'correctly' then the Landlord will have leverage in ensuring that it is rectfied... because after all you do still own the land and may terminate lease if the terms are violated. 

This is good Alecia it shows an actual time based accounting on cost of time it takes to manage X units.

Also - many loan programs  require at least  3  credit accounts with history be  on  credit report for all borrowers - good luck

This means that you will probably need to pay registration and filing fees in at least 2 states if you don’t buy CA property as a CA resident.Be sure to tell your accountant that you may now need to file non-resident income tax returns in each state where you own property as well.

If your serious about becoming a real estate investor, you will need a good tax accountant in your corner.