But -- rant incoming -- as @Erin Spradlin, resident midterm rental expert in our household would probably ask you, why limit your targeting to just one demographic? 

However, an essential exception emerged in the 1990s, allowing specific rental income to be categorized as non-passive.

Not sure … I may just reach out to some friends in that income class and get their thoughts.  

Their source of income is critical as they have no backstop (sick days, health insurance, etc).

And then in comes the junk....we're now at 20 cars, a bus, an RV or two, a tow truck, washers/dryers, and even an airplane fuselage...yes you read that right.A bunch of us neighbors called the County of course and they sent out a Code Enforcement officer.

Our Situation:Two couples, new to real estate investing, each with one working spouse with a high income (W2 and 1099) and one non-working spouse plan to go 50/50 on a new construction STR which will not close until Spring of '25. 

Side question, assuming that you have a pretty strong income from work, would you hold your commercial real estate as long as you can and to by another on top of the existing one or would you 1031 to a bigger commercial real estate instead?

Still a great market for owner occ/house hack, but again it's not a high income area so rental rate is going to top out a bit in my opinion. 

Maybe some price appreciation on property would occur and I'd have depreciation to offset rental income and such.

As far as a multi, personally if all things were equal I'd go for the multi for a few reasons.  1) Added diversification.. if one tenant doesn't pay, you can still cover property expenses with the other tenants 2) Shared capex... typically, one roof and one property to maintain but multiple streams of income 3) Less vacancy.. usually multi's rent for lower, for example one of mine is the sweet spot of 3 bedrooms for $1300.