Now, it's paid off fully, worth about $65k, I self-managed it from the west coast and it's brought in over $40k in gross rents cash flowing about $800/month.

I am also considering the coast, maybe a STR.

Not sure which markets you're considering, but if you set your sights on the coast I can help with local lenders, attorneys, tax pros, etc. 

the reasons you post.tax's  somewhat limited development regulations compared to other markets. work force   also close to Mexico and all the folks streaming in that need housing.building cost still lower than most of the country.Land forever .. no shortage sprawl is not a bad word.Political out look  conservative business friendly compared to West coast. 

The severe housing shortage is increasing housing density from coast to coast.

I would either just put the return in a brokerage account, or buy a rental property near where I now live (on the east coast), where you can buy a lot more for the money.

I’m an agent with New Western, and I’d be glad to help however I can as you get started.

ADUs are a great idea and California (and most of the West Coast) is on the forefront of the most allowance and options for them, but I would think about your long-term value also.

Being able to use the depreciation or accelerating the depreciation as much as possible also helps especially before the end of this tax year.Thank you for this detailed description of how to qualify and I have helped investors use this strategy in Michigan in college towns and along the coasts so I know there is interest.To your success! 

Out here on the West coast the buyers brokers agreements were not nearly as common as back east and buyers out here are not familiar with them and are balking.. then sellers are balking at paying outside agent because of the laws Etc etc..