Yes, you are crazy!
Just kidding. Sort of.
So I've been mulling this over in my mind and wanted to see what you smarter, more experienced people thought.
I see all sorts of potential problems with your plan as you have it presented currently. I may not be smarter than you, but I am probably slightly more experienced than you, having purchased a house in a bad part of Kansas City that I then rented to family.
First, as you seem to already know on some level, that is a REALLY shitty part of town. REALLY. I have no idea what your friend does in the area, but if she spends any time at all there, it boggles my mind that she would actually WANT to move to the area. "Northeast," as the area is known, is the kind of neighborhood where people try to get out, not in, which means if your friend DOESN'T end up buying the place from you, good luck trying to move it. Personally, there is NO WAY I would buy in that part of town.
I paid $40k three years ago for a 3 bed, 2 bath, 2 car garage home in a better part of town with better schools, close to dining, shopping, and entertainment, easy highway access and a quick commute to downtown. I have very little confidence that I will be able to sell my house without taking a loss.
But location aside, here are some other thoughts regarding your plan.
It has 5 bedrooms and 3 bathrooms - my friend would stay in one with reduced rent ($150 per month). I'd rent out three more rooms at $250 each. No utilities included in rent.
I would allow pets with additional monthly and pet deposit - that would all go into a separate fund.
So are you going to set up separate meters for every room? Or are you just expecting this random group of individuals to work together to ensure utility costs are kept low, divided equitably, and paid in a timely fashion? What happens if you have a great tennant who conserves energy, pays timely, etc, and then you decide to rent another room to a person who meets your screening criteria, but turns out to be an energy hog. Now this great tenant is potentially saddled with increased utility expenses through no fault of their own. And what if this new tenant always pays the rent to YOU on time, but never gets their portion of the utility bills in on time to his or her roommates? Your great tenant is forced to not only pay higher costs, but now they have to cover other people's expenses or risk having utility shut off.
It turns out your great tennant is also alergic to cats and dogs. Now they are forced to decide "Do I live in a house with pets and be miserable or do break my lease and move," all because YOU decided to rent a room to a pet owner.
You can see where this is headed. There are countless other potential problems that could arise in the situation you envision.
The neighborhood is really bad, but this is right next to where my friend works and I would only rent to those who qualified.
BECAUSE the neighborhood is really bad, good luck finding people who qualify AND want to live there. The main reason people live in Northeast is because the can't qualify or afford to live anywhere else.
Some other thoughts...
My best friend lives in KC and works in a very poor part of it (zip: 64127). She really wants to move out of her parents house and into that area... but she can't quite afford it yet.
I see you are new to the forums, but have no idea how much of the actual site you've read. In my opinion, one of the main tenets of the MMM philosophy is not taking on financial obligations (buying a house, having kids, etc) until you are ready for it. From your own admission, your friend isn't ready for this responsibility yet, so it doesn't seem to me to be a wise decision to take it on for her.
Is she paying rent to stay with her parents? If not, then moving to a place where she WOULD pay rent isn't going to improve her financial situation. I get that she doesn't want to stay with her parents any longer, but if she is not in a position to move out WITHOUT your help, then frankly she has no business doing so, and her focus should be on getting herself in a better financial state.
Look, it would be great if you could help a friend out while earning some cash on the side too. Sounds like a win-win. However, in my mind, there are too many red flags with the house AND you plan to recommend moving forward.