They can provide guidance on potential legal options and rights concerning the city’s demands and the lender.Negotiate with the City:Seek Extensions or Variances: Your friend can request an extension on the deadline to comply or apply for variances that might allow the property to meet less stringent requirements.Explore Grants or Subsidies: Check if there are any local, state, or federal grants or subsidies available for renovating older properties, especially those providing low-income housing.Engage with the Lender:Discuss Financial Hardship: Present the case to the lender, explaining the situation and the financial hardship imposed by the new building codes.Propose a Loan Modification: Suggest modifying the loan terms, such as extending the loan period, reducing interest rates, or even deferring payments temporarily.Negotiate a Short Sale: If the property must be demolished and rebuilt, your friend can discuss the possibility of a short sale where the lender agrees to accept less than the owed amount to avoid foreclosure.Explore Refinance or New Loans:Seek New Financing Options: Look for other financial institutions or private lenders willing to provide financing for renovation or rebuilding.

We are not first time home buyers but have three single family homes ( rental) properties in California but want to buy our first apartment complex out of state for generating  cash flow for the long term.

Hopefully, this provides perspective.Keep in mindThe Fed started hiking rates in March 2022, and only stopped tightening in July 2023, having lifted short-term interest rates by 525 basis points or 5.25%.Average 30-yr mortgage rates started moving aggressively upward a bit earlier (in January 2022) and only peaked (at just over 8%) in October 2023.

I understand, this will work well long term if or when I begin investing in residential properties.

For a house hacker, what is the term requirement for how long one has to live in one of the units before looking for the next deal?

I like the idea of short/mid term rentals more then the long term...one big reason is not having to move all of his stuff...or at least being able to take my time.

Evicting a tenant from a rent-controlled unit typically requires a valid legal reason, such as non-payment of rent, violation of lease terms, or the property owner wanting to occupy the unit themselves (owner-occupancy).

I'd love to try the mid term rental strategy with the property we find.

It's the same everywhere.Just include in your offers a term that the seller pay your agent from their proceeds. 

Long term does not make much money, but less work.