After taxes, that is 52k per year in CA, which means you need to save an additional 20k annually over the 70 you have.Living off 32k in Santa Barbara sounds improbable.

Employers will never tell you about it of course so not too many people know about it.

The recession hit, employment dried up and the house was upside down and we ended up stuck where we were.

(Addition, Renovations,  etc.). 

From what I've heard, you're better off paying out dividends which are subject to capital gains tax as opposed to pulling a salary that is subject to employment and income tax.

Should you convert the attached 1-car garage into additional living space?

We are going to apply for a small business loan to open the LLC and for any additional start-up costs. 

Additionally, this property is close to the airport so there is a lot of potential to turn it into an airbnb hub, leading to more cashflow and of course, more management/cleaning time.Long story short, would you take a deal with these parameters:- Asking price $165,000 (pre-MLS price) - Duplex consists of: 1 bedroom main floor and basement unit & 1 bedroom upstairs unit- Total rent: $1600/month (tenants pay utilities)Addendum: I just bought my first property with 11% down (before I found BP), so any suggestions (or links to forum posts/blog posts/podcasts) on creative ways to finance this deal, please let me know.Thanks BP community.

If I were a resident I would like the somewhat isolated location of the town but it seems far from many major employers, that is unless your tenant works at one of the many warehouses nearby. 

When you say that refinancing limits your ability to write off interest, do you mean that you won't be able to write off the additional interest increases or do you mean that it will also hinder the previous amounts as well?