Ah, man.
Check out this New York Times article on ADU’s, or accessory dwelling units. Instead of an elderly relative moving in, I am envisioning renting a single studio-apartment type of unit to a college student.
Another pipe dream that may come true somewhere down the road. Our backyard (which we affectionately call “the back 40” is huge and it would be so cool to add another unit back there to rent out. A parking spot can be created with alley access, to keep any extra cars off the street. Several homes in our neighborhood have apartments above the garage, set on the back half of the property.
Look, this Denver-based company (got the link from the article) even specializes in this stuff. So awesome!
Of course, a cheaper alternative would be to upgrade a vintage trailer like so:
My Friend Staci 
I would absolutely move to an upgraded vintage trailer in your backyard.
If only we had a big enough yard. We live on (I think) 0.19 acres.
A lot of people around here do build 2-story garages with apartments on the second story and rent those to college kids, but I think we’d turn it into a half-man-cave-half-craft-room.
Haha! Yes, that would be tempting!