What is the best way to setup wordpress development environment for freelancers with version control?

Have you looked at VVV ?

Varying Vagrant Vagrants is designed to support WordPress plugin and theme development using vagrant boxes and github version control.

https://github.com/Varying-Vagrant-Vagrants/VVV

Re Github/Bitbucket – you may possibly use one master and then have a branch per subdomain if there is enough commonality, but from the very vague information you have provided it looks like one master per subdomain would be more sensible. That way development would not overlap.

I won’t paste the whole VVV front page here, but just a bit to get you started:

Overview

The Purpose of Varying Vagrant Vagrants

The primary goal of Varying Vagrant Vagrants (VVV) is to provide an approachable development environment with a server configuration common for high traffic WordPress sites.

VVV is ideal for developing themes and plugins as well as for contributing to WordPress core.

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