Because we'll need to redo the backyard and have significant repair inside before we find new tenants, I'm considering letting them stay if we can increase the security deposit significantly and charge a higher rent to offset the accelerated wear and tear on the home.

We'd love to invest in our backyard but we feel the Bay Area is so expensive, which creates more risk for our first property.

I am debating between building an ADU in our backyard or buying an investment property out of state.

I am looking specifically within Toronto city limits, unless I can find something outside the city for a much higher return, as ideally I would also like to live in the property, maybe in a shed in the back yard converted to have electricity, heating and plumbing.

Here are some pros and cons in my opinion:Pros: Desirable area, potential for 3 legal 2 bedroom apartments, new hot water boiler, shingles are ~5 years old, separately metered, lot is sloped toward back of building which allows for basement in-law suite to exit to ground level in backyard, seller to provide fire retrofit, parking for at least 4.Cons: Hasn't been updated electrically (2-prong plugs and 60 amp service), concrete stairway needs leveling (tilts toward house), in-law suite is not legal unit, older finishings in kitchen and bathrooms (and plaster walls).The list price is $399,000 but I wouldn't want to pay/offer this much.

Other things that may be there;Got a septic tank buried in the back yard?

How I see it is, if you're going to be there long term then that tells me youThere's also a lot of advantages in doing it in your backyard specifically your local knowledge that you can't get somewhere else and finding the boots on the ground is easier.I say this as someone who does out of state.

I started house hacking because I firmly believe the best place to invest is your own backyard.

This is like comparing Babe Ruth to Alex Rodriguez for baseball stats. 

I'm a big proponent of investing in your own back yard if it makes sense.