There is a catch - the couple wants to 1031 the funds into their sons next larger project which is TBD.

I'm guessing they want some sort of updates during the rehab.  

Some investors look for cash flow and some look for appreciation and there are investors who need to merge the two in order for the deal to be considered good.I think identifying what sort of investor you are looking to become should be answered first. 

There was something in it for both of us.You have to find some sort of common ground or gain a lot of trust to show how serious you are about this.

For the first time in years I’ve noticed many of the larger apartment complexes even offering the first month free to fill vacant units, so it’s clear that demand is down.

Furthermore, California has a very anti-landlord and anti-real estate investor government that can cause you all sorts of other problems as well. 

If in your shoes, I'd be sorting my marketing strategy, and jazzy ways to do my frunishings, marketing budget, how to Gorilla the hell out of it.

Digitize physical receipts for easy storage and use a consistent naming convention for easy sorting - 2024.03.25 Home Depot.- Maintain proper records, such as contracts, settlement statements, and promissory notes.

Micro-markets are like checkerboards across larger markets. 

If they can build a larger home and sell it for the same or more rather then building a couple small homes why do it?