Off market deals usually have nonrefundable deposits and a clunkier process that isn't as suited for out of state people until they have good contacts in the area to evaluate the property (mostly contractors that feel comfortable evaluating projects for you).

Not bad, especially considering it’ll take about 9 months for permits and a year for construction.Now, let’s say you decide to do a lot split with two 4,000-square-foot duplexes.

It seems like finding a better Property Manager is the step that needs to happen, and as one myself in MA, you just have to try again.  

I have experience managing this on multifamily properties as both an owner and a lender.

It seems like you have some very solid goals of multiple income streams, and a well calibrated risk tolerance. 

The key is a great contractor and a clear, detailed, well-thought-out scope of work. 

I've worn three hats in the seller financing world (as a property buyer, as a property seller offering terms, and as an investor that buys seller financed note). 

I picked a mentor and a team to follow and the rest worked out

Quote from @Isadore Nelson: Give the expectation, a deadline, and a penalty.

If you want to nestle into North Scottsdale, you can get the big house and a decent lot, but it will not be a huge lot.