If you're operating a short term rental that focuses on <30 day stays, you should consider a Schedule C business.The 2018 Schedule E tax forms has a box for Short Term Rentals but I'm not clear what they have in mind.

Zillow says $125 rent increase equals a move and $50 increase is a common increase for tenants who stay.

you should get your financing locked down first. you may find it next to impossible to find financing for a foreigner with those kind of down payments. and for sure heed @Ned Carey advice top of the market not the bottom look for a solid 5 to 8% return instead of 10 to 15  those are for those that live there and can stay right on top of them. 

If giving a 24 hour notice Keeps your tenants comfortable, it seems like a simple solution for healthy future relationships.

It sounds like he got burned on his first SFH and that made him stay away from them.My real estate agent suggested a refinance as well, which sounds like an ideal option. 

I'm worried about  if I should purchase  outside of my comfort zone.

The question becomes how comfortable are you with debt?

I know you have to live in each for at least a year but I should have enough saved to where I can shortly make a down payment on another property regardless of needing to stay in the first home. 

Just stay aggressive and hopefully good things come your way.

If they pay you can always let them stay.