@Hsin-I Hsu  It depends on your long term goals, risk tolerance and earning potential.A couple of bay area sayings:   Any time you can afford to buy real estate you should.  

WikipediaLow crime rate: Never invest in any city on this list: The most dangerous cities in America, rankedLow operating costs: Good indicators of a pro-business climate include:Property taxes: State Property Tax Rates - Rocket Mortgage.State average insurance cost: Insurance - ValuePenguinState income taxes: Tax FoundationLow risk of a natural disaster: Natural disasters can devastate your property and the surrounding community, leading to job losses and the closure of shops and businesses.

From a lender's perspective, separating personal and business credit is critical for scaling operations while mitigating personal financial risks.

Just know the layers involved and be sure you are still able to complete due diligence on the sponsor. 

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.

Scaling is fun but the more you add the bigger the risk is.

query=garage#sear...If you can rent a 2 garage at $450 without spending ~$150k for a garage ADU conversion, no work/risk of the ADU conversion, the lower maintenance/capex, easier eviction, no rent control, less tenant interaction, it will not convert your SFR to rent control, etc, it seems superior to the garage ADU conversion.  

I definitely agree that rent by the room is awesome for increasing cash flow - again, it does come with it's headaches but with the higher risk comes higher reward (I've been doing it for almost 3 years now, it's really the only way to make the numbers work with little cash down on properties).From my personal experience, talking to others at meetups, and reading this post, I think there's definitely demand for specialized rent by the room property management.

Generally you go with the strictest ruling.With that said, it becomes a risk play.

That kind of experience builds confidence and reduces risk over time.