Install cameras around the parameter of the property today; post no trespass signs; change your for rent listing. 

I changed Grandview and Raytown to be B-/C+ neighborhoods.

You cannot change the area or the demographics of the area, so you have to pull the levers that community "needs" / "wants". 

.• Use some equity from the sale to make this transition smoother.I’m torn between maintaining our current home as an asset and buying  a new smaller house to use as a rental after we move back in versus simplifying and focusing on a single upgraded property Considering factors like market trends, potential equity growth, and quality of life, which path do you think would be most beneficial?

I already have money left in the property and hesitant on sinking anymore in.  .If there isn't much equity, and there is so much to fix to make it livable, why not do a "deed in lieu" with your lender and move on with life?

My life has definitely changed over this.

The government is trying to protect people who managed to run their life well enough to buy multi-million dollar homes?

Several options you can explore to get the down payment capital: Solo401k; HELOC on personal residence or from equity of the SFR; Cash Value Life Insurance Policy; Business Credit; Private Lenders, to name a few.

Just $24,000 per year and could be drinking Rum and fruit juice for the rest of my life. 

Well, I guess this says it as well as I could.This growth in ADU establishment goes hand in hand with progressive changes in Michigan's zoning laws.