I'd like to move forward with option "b".

I'm not sure if any also lend in Canada, but you might want to expand your search to include "non-recourse" just in case it leads to some more options for you.

Then, we would move on to another house and repeat, either keeping the former house as a rental, or selling it on a lease with option to buy arrangement.

@Pat Aboukhaled I would ULS (unit lot segment) the primary house and include a clause in the call option that would prevent them acquiring the DADU.

However, I don’t yet have the funds for a down payment on another house, and I’m trying to figure out the best option for where to live while I rent the apartment.Do you have any recommendations for managing this transition or tips on finding a temporary place to stay?

Hi Allen, that’s an exciting position to be in—$500k gives you a lot of options! 

You could also focus on attracting weekday guests—maybe offer discounts for longer stays or highlight features like fast Wi-Fi or a comfy workspace to appeal to remote workers.Since a hot tub isn’t an option, maybe think about other ways to stand out.

You should definitely be able to at least find yourself some solid realtor options via bigger pockets.

And the really messed up ones, they don't even give a landlord an option, per fine print in contract, they just go out and do whatever and send a bill after the fact. 

You can tell that the lender isn't granting this extension under the provisions of the loan's 1-year extension options.