My boyfriend (now husband) and I bought a 4 bedroom, 3 bathroom house in Seattle in 2010, and paid the mortgage by having three roommates. We started phasing the roommates out when I finished graduate school, and we are down to one roommate now, in a suite in our basement. We have also rented a room on AirBnB. We'll probably always have one roommate or list one room on AirBnB, depending on whether we value convenience or profit. My husband and I have a kid now, so we value having a low-maintenance roommate/tenant in the basement who keeps to herself.
You're getting great advice on this thread. What worked for us, having about 12 housemates come and go over a 5-year period:
A month-to-month agreement: if someone wasn't a good fit, we could ask them to leave. Likewise, we had a lot of people stay less than a year. Tenants have fewer rights in Seattle if they live in a shared space with the landlord, so we never had any issues with attempted squatters or unpaid rent.
Splitting the utilities bill 5 ways to discourage wasting water/heat.
Charged first months rent, last months rent, and a deposit to move in. The last month's rent gave us a cushion to find another housemate if someone left suddenly. We'd refund this if we found a new tenant quickly.
We didn't have a lease, but a Google doc with our expectations. I don't know if I'd do this again, but it worked well for us at the time.
Have really clear boundaries, including emotional boundaries. Some housemates are looking for a mommy, and I had to set really clear boundaries that it wasn't going to be me.
What I'd do differently:
Charge more. We decided our rent amount by dividing the mortgage/taxes/insurance by five, and that came out to slightly below market rate. I've learned that charging more tends to attract more stable people. This has proven true with my AirBnB side gig too.
Hire a housekeeper and charge the tenants. Despite clear written expectations new tenants agreed to, various house meetings, chore charts, and public shaming, some housemates would not pick up after themselves. Because I cared more about the property than renters, I ended up being the defacto maid.
Interestingly, friends and acquaintances did not really make better or worse housemates than the people we found on Craigslist. Out of 12 housemates, about 2 were really excellent, 2 were so terrible we asked them to move out, and the rest were adequate. There were friends and Craigslist people in all of those categories.