Live in one apartment.

My goal is to obtain a property requiring rehab while living in the same property for the first 12-18 months. 

Ask questions, get an inspection, and make sure it’s in a decent area where there are renters and that renters will want to live there.

Jealous that you live so close to it!

I’m living very conservatively currently but will get there.

And if you live in that former replacement the right amount of time you'll get to take a prorated amount of that gain tax free as well.  

Additionally, the contract requires that the deed be recorded in the borrower’s name once the contract is paid in full, but it’s silent as to whether we have to record when we purchase the seller’s interest in the contract.

Using a 3rd party out of town manager when you live next door. . ..

Hey Becca,Have you looked into Additional Dwelling Units out there? 

I live in FL and have been doing all my biz there for many years, 100s and 100s of deals, with 1ks of reno/ repairs, and am an expert with all the govt programs and how to deal with all the inspectors from each city and happy to recommend.