.- work with an experienced agent to guide and assist in identifying properties that are priced well and can cash flow. 

My question is- what if life circumstances change and I need to sell the owner occupied portion within that 3 year window?  

Should I consider ground lease or sell outright ?

@Anthony Quint, the 1031 exchange is something you don't have in CA that allows you to sell appreciated real estate in the US and purchase new real estate while indefinitely deferring paying tax on profits.The thing about this for a non US citizen is that you will be subject to a 15% withholding called the FIRPTA withholding tax. 

They originally sold for $110K to $125K when the project was completed but was only able to sell 40 units out of 102 in the building.

How can I sell it with seller financing if the bank already has a note on the property. 

If we purchases a home as an investment property, build a DADU, and sell the home and DADU (around 12 months after the purchase), what's the best strategy for tax saving?

You sell the property for the same $500K to an owner user with $100k down and carry back a wrap note of $400k at 10%.  

I’d rather sell than go without any insurance.

I could actually sell the property now for over 300K right now.I am flying there to get a new refrigerator, change the locks, and get new remotes for my garage door plus meet the Property Manager.