My suggestion is to get them going in that route, buy a house they like, can afford, and see themselves in for 7-10 years + and then get going with paying it down.

Overall I love the R2 zoning route, but the permitting & construction costs alone will be tough with the budget you outlined in your post. 

I'm not sure if they are currently working with any builders in Cape Coral at the moment, but you can connect with Zach Lemaster if you are interested in going that route. 

If they have a assets or a stable job with good pay, I would definitely go the lawsuit route and I would do this BEFORE they leave the property and you know where they are.

Tenants can be frustrating (to say the least)... and the situations that come along with them - from stopped up toilets to evictions, among many others, present challenges.I wouldn't recommend a Heloc for a long term hold as the rate is variable... and over 4 units you will require a commercial loan if going the traditional route of financing.  

For those of you who’ve chosen the fund route.

All I can say is no way we would be where we are today had we gone the out of state route. 

Generally if you can qualify for conventional, that's the better route. 

If so, you are perfect for finding a fixer and going that route.

Generally, if you're going the MLS route you're going to need to put a bit of work into it.