encroaching property - Sacramento

[Daniel Zapata]

Hello BP!

I'm looking at a property in Sacramento which seemed like a great deal at first: a 1 bed / 1 bath duplex in the front (fully rented at market), plus a house on the back of the property (the inside of the house is only framed, there was a fire and it was gutted).  There is supposed to be an alley which runs through the back of the property and all the adjacent properties, but multiple properties are encroaching on that alley, including this property.

Upon further investigation, this property also encroaches on the property to the left, plus it may also encroach on the property to the right.   My agent went to the city and they confirmed that the alley is not abandoned and is active as far as they know and there is nothing registered with them with regards to the encroachment.

1) Are there any ways to resolve the neighbor encroachment issues without altering the structure (i.e. buy that piece from the neighbor, set up a binding agreement)?

2)  Are there any ways to similarly address the alley encroachment?

3) Is this just a big can of worms not worth pursuing? My agent said that either neighboring property could try to claim their land back at any time, so I don't want to ignore the issue and hope for the best. Before the encroachment issues, I was looking at fairly straightforward BRRR which would cashflow very well.

Thanks for any advice,

Danny