You can't really ever tell what someone does with their money, you just need to make sure they can afford it. 

Recently I’ve been looking into the ~18 year cycle of rising prices and the inevitable correction once people can’t afford housing anymore or the new home supply outweighs the population.

He also must meet your list of criteria upon move-out:  leave quietly, no damage to the property, in relatively clean condition, move his furniture out.  

DTI is an important factor when determining how much house you'll be able to afford.

I think that's a good plan to get your finances together first so that you then know how much you can afford in your search.

My goal for my first year in real estate is to do enough sales in order to be able to afford a down payment on my own duplex, or other type of residential income property! 

In general, everyone wants to stay in the nicest property that they can afford and when groups get together, the affordability of the nicer properties increases and the lower-end properties will fight each other for bookings.

The people who are born and raised in Denver continue to opine about the affordability, but those who are moving into the city with fresh eyes will gladly take their profit from the coasts and pay all cash, over ask in order to live in (again, my opinion) the best city in the country - diverse economy, great work/life balance, friendly people, city without most of the big city problems, 300 days of sunshine....

Since you are planning to house-hack, I would recommend you figure out what is affordable for you in terms of monthly expenses. 

Since the prices of homes are so high in California, purchase a home you can afford with your pre-approval letter with the most bedrooms you can find, then you live in the master and rent the other rooms out to college students, young professionals, single people, etc.This will help you break even for your mortgage payment/could potentially make money each month.