Due to item 1, adding an ADU can require years to start achieving any return (once the accumulated cash flow recovers the initial negative position).4) Adding an ADU is a slow process.

I now require any animals brought onto the property for any length of time, even service and emotional support animals, to be registered with petscreening.com or otherwise verified through a third party, and if tenants or their guests are not happy with that, they can send the documentation directly to me (vaccination records for the animal and a doctor's note with medical license and clinician contact information be sent to me).

You can deduct a proportionate amount of your mortgage interest, property taxes, insurance, electricity, water, gas, etc. and you can deduct any expenses that are directly associated with the portion of the property that is being rented out.

I'd purchase a second home and fulfill the loan requirement for stays etc.

My question is should we include internet, water, gas, and power?

My bank requires $1,500 in each checking account at all times. 

So I require all of my sponsors at this stage to have at least full real estate cycle experience with little or no investor money lost (and the more cycles the better).

Reach out to your local Section 8 office, they can tell you exactly what "minimums" are required for the program. 

It will require some work but we are extremely hopeful and excited. 

I did a credit check, criminal background check, got pay stubs, required income 3x rent, and got employer confirmation and prior landlord reference (but I never got in touch with the prior landlord successfully)