Make sure you fully understand the market you’re investing in, including rental demand, property values, and local landlord-tenant laws.Building a good team early on is also key.

that we’ve learned in our 24 years, managing almost 700 doors across the Metro Detroit area, including almost 100 S8 leases.

With rainy day funds included there are reports that CA had over $20B surplus. 

When its included in a lease for real estate then the laws pertaining to residential rental security deposits in your state apply but when its separate you should have more leeway to get some additional deposit to protect you.

That's before you pay any debt service.To answer your question: No, it's generally not a good idea to lose a bunch of money every month.

Im self employed, roughly make $130k gross anually, 1099 NEC , no debt at all, 740 credit score. 

Eliminate debt, establish a budget, and save.

The challenge we're facing is the lack of short term rental data for the appraiser, and we won't know if it will meet the debt service coverage ratio (DSCR) requirements until the appraisal is complete.Has anyone dealt with a similar situation?

These typically include services like renters insurance, HVAC filter delivery, pest control, and sometimes utility management.

of those I like next door best because it is hard to fake and the reviews are easily tied to a reviewer in your community.The costs of ADUs vary significantly for various reasons including by ground up vs conversion, difficulty with lot (sloes, access, etc), finishes, and even the size (bigger typically have lower PSF).Good luck