Freddie has similar intricacies, but also does not require a two year history of receipt; https://guide.freddiemac.com/app/guide/section/5306.4If you can use the rental income to drive the DTI down so that you can reduce the down payment similar to that of the FHA product, the benefits of the conventional option will outweigh the FHA option, as I'm assuming you have a strong FICO based on rate quoted with no points.  

They realize the due on sale clause could get exercised and believe the risk is justified by the reduced rate.

Ok, if it's still sounding do-able, the next issue is that section 179 can't be used to create a business loss, so it would only reduce your taxes for the year if your rentals are operating as a taxable gain (but rentals are often at a tax loss thanks to depreciation).  

It’s still a worthy strategy to force cash flow that’s rare to find in SoCal, especially if you can reduce the cost of construction by doing a conversion/using an ADU grant or even buying a property with an existing ADU In general, even if the ADU valuation matches your cost including grants, they are usually not worth it in southern CA in single family zones. 

Given the permitting timeline, I will offer to purchase some of the furniture and redecorate the rest (so half and half to reduce some furniture building time).

Using a 401(k) loan reduces your emergency liquidity, which could make the investment riskier if unexpected costs arise.

If you think about it in any industry less transparency and more friction in the transaction will increase fees/commission vs reducing them.I like the idea as an investor of having different agents, a team of agents maybe 3-4 bringing me deals, but I think less of that will happen now as all will have to have you sign some kind of agreement up front. 

If you pay two years' worth of property taxes in 2025 (January and December), both payments are deductible on your 2025 return, potentially reducing your taxable rental income significantly.

High probability that you’ll uncover an oh-$**** issue that will reduce or eliminate your projected profit. 

This reduces exit options and affects the value. 10) Small number of small units is the most expensive residential development there is.