You have a decent loan on the place that you won't be able to replace from a cashflow standpoint.So keep at it. 

As Vince said it is a quick guideline and won't work in most places with current interest rates and house prices. 

I know there's seller finance and "B" lender that are good for the short term, but if a balloon payment is due say in 5 years, there's no guarantee that my DTI would be in a better place then I'd be stuck without funding. 

The fact is that landlord/tenant attorneys and judges know each other and eat lunch at the same places and if you get an attorney that the judge listens to, you're in a good spot.

You’re in the right place, and it’s great to see your enthusiasm about getting started in real estate investing.

With the city contemplating expanding the ADU ability to city wide, is there any benefit to doing a rezoning now (assuming successful) before the citywide expansion takes place?

I'm all over areas with at least 50k people (Loveland, CO), but also places with a 1M+ (El Paso) and Large Areas like The Greater Denver Area. 

To scale this route you need to have a good system in place to ensure you are profitable.

Nothing is being added in its place, they just want "less units" which provides more open space.

Which may also be a reason to hold on to your current place (appreciation).Second, have you been in your primary at least two years.