It is usually difficult to take money against it from the bank, it might not be a 1:1 value add - meaning if you invest 100k into an adu it might not raise your value by 100kThat being said, it can be pretty lucrative especially in expensive and sunny CA - since building lots are no where to be found and existing real estate returns are very poor.My partner builds these units.

Hey BiggerPockets Family,My name is Gabriel Peryam, and I’m a born-and-raised Athens, GA native.

You need to double check underwriting, conservatively project disposition, and stress test the metrics.

Missing ductwork and the A/C not working right could have been quickly tested during your walk through.

I have flipped new homes and townhomes but phased out raising a family and now am focused on utilizing my skills which are building, selling, expanding a circle of influence to focus my effort on the above.

No talking to will fix a person raised to live like a pig.  

Here’s what could be going on:✔ Legitimate Concern – Some tenants worry that HR inquiries might raise red flags with their employer, especially if they’re still in a probationary period.⚠ Fabricated Offer Letter or Pay Stubs – Unfortunately, fake employment documents are common, and verification through HR is one of the best ways to confirm legitimacy.⚠ Unstable Employment – They may have lost the job or never actually started, making verification impossible.⚠ Other Issues – They could be hiding something (evictions, unpaid rent history, or other financial instability).What You Can Do:✔ Ask for the official employment verification letter – Many HR departments provide standard verification letters upon request.✔ Verify pay stubs – Cross-check them with bank statements to confirm deposits match.✔ Call the employer directly – If HR is off-limits, ask for a manager’s contact instead.✔ Stick to a Consistent Screening Process – Fair Housing laws require uniform screening criteria, so making an exception for one applicant could lead to discrimination claims.

If we were not able to raise the price of our homes by 20% or more we would had to stop.. my LORI plan started at 600k sold two of them and made our normal 100k net.. last loris I sold 36 months later went for 850 to 900k and we made right at 250k NET on those ones.. so it was very specific to plans that CASH buying empty nesters wanted ..

I'd say consider split testing the SFR and LTR approach. 

One of my toughest sales was a raised home in a flood zone.