We have no idea what we are doing and I can’t wait to learn some tips and tricks from you all! 

At the end of the day, as long as you have the zoning you just need to go talk to your city planning/building department and tell them what you want to do.

not really after taxes and realtor fees.I think we are talking about the same deadline: If you did not live there for 2 years of the previous 5 years, you cannot take that 500K subtraction from your capital gain, assuming you file jointly.  

So my question is, how long does that member have to be there until you can resort back to a regular tenant?

In addition, long holds historically have produced good returns in that market.  

You can arbitrage as long as you have your Vacation lodging services license, but finding an owner to let you Airbnb their property is very hard to come by.  

Separately, I have 50% ownership of an LLC that holds real estate on which we are building a new investment property. 

If I was in your position I would look to air bnb or VRBO the property you purchase in San Diego this way you will have less negative cash flow than if you were to rent it out to a long term tenant. 

The other option would be to see if you give them a long escrow to get out of the house.

v=5yLr4ktCtqY&t=1807s).David and Rob advised that since I'm in a bad location, I should consider selling the house and buying in a better area judging by the long time it took to get a tenant.