In the cities the government got involved in housing and low income housing was built for poor people.

Investing in real estate and 1031 exchange replacement properties may not be suitable for all investors and may involve significant risks.

If you recall when the rates jump super quick a few years ago many of these same hedgefunds/insurance companies just one day decided to stop lending all together until rates stabilized..

However, their terms involve a 20-year amortization, a 5-year ARM, and a rate of prime + 0.5% thereafter.I’m exploring other options for financing and would appreciate any suggestions or advice.

My goal is to understand the current demand and rental potential for ADUs in this part of the city, as well as the costs involved in building.

There is work involved as you have well found out. 

.- Stabilize the foundation with helical piers on the exterior. 

If you have significant resources you can start on your own, if not partnering with someone who brings some local knowledge can accelerate and stabilize your journey. 

It took about a year and a half to stabilize the property but the property is stabilized and cash flowing.

This usually involves putting down 20% down payment on 150K-170K houses.