Leverage magnifies return. 3) The effort involved in adding an ADU is comparable or larger than a rehab associated with a BRRRR.

As I invested a few years back, my returns have been pretty good with cashflow and appreciation. 

There are some exceptions, but the HOA dues normally kill your returns and there are all kinds of other issues having tenants living close together. 

You are investing for return on capital. 

Given you're in Texas and don't have a state tax return, it really opens you up to work with providers nationwide. 

They can return the dryer and purchase a gas one. 

And how did you figure out your returns ahead of time on this type of deal?

Best bet would be a “partnership” with a monied individual looking for a high risk/high return passive investment with you providing the “active” part.  

While it's positive after expenses and has potential for improvement in year two, it’s been a bigger hassle than anticipated and taking attention from other priorities and areas of our life with not enough return. 

This allows new investors to gain experience while minimizing risk and maximizing returns right from the start.