If a HELOC isn’t an option, alternatives like a home equity loan, business line of credit, or a DSCR loan could work depending on your situation.

Another alternative would be to buy the property yourself, keep the mortgage in your name but have your daughter on the title.

Are there alternative strategies you’d recommend for this market or nearby markets which are of commuting distance to Danbury?

This is another issue I see with those who seek out alternative financing because it’s the only way they qualify to make the purchase. 

I offered her before this event to move out and honor deposit back even contract building is 6months lease also wafted some negotiation with HoA they offered to move her to alternative unit.

Not sure if it was mentioned here already, but another creative alternative is to purchase a SFH that has a casita. 

Some hard money lenders specialize in fix-and-flip loans, while others might have a more robust understanding of the BRRRR method.Would you like help connecting with others who've used Rehab Financial Group or researching alternative hard money lenders?

A deed is given and accepted as an alternative to ("in lieu of") foreclosure.

Alternatively, should I focus on making minor upgrades to the rental property to increase the rent and continue holding it, considering the neighborhood’s growth potential?

You may be far better off structuring it as him being your lender (as opposed to a partner) or, alternatively and likely less attractive, you being his contractor.Part 2.