He wanted $1000 in earnest money at signing while I want (and really can afford) only $100.

If they feel that they can stay in your property until they can find a nice place which they can afford and be approved for, they will hold out for that.

So, in lieu of appraisal fees going up 50% so that an Oakland appraiser can actually afford to live in Oakland without doing a zillion super quick appraisals a month, sometimes you've got to "help" them like this. 

I was kind of wanting to start smaller for my first property, and keep to around 40-50k (that way if it didn't work out, I could afford to pay the loan and not lose my house).I'll also be transferring the cash to an LLC in order to build equity/assests for that, so that's a reason I decided to go the route I'm going.

I find this frustrating. 

It seems they are making some zoning changes to keep rents affordable for residents rather than draconian zoning restrictions in places like CA which restrict building.https://coloradosprings.gov/adu

(Note: in an option contract, the amount you pay the seller as 'valuable consideration' will be his to keep regardless of whether or not you exercise or assign the option to someone else... so be sure that you can afford to lose this money if you cannot find a buyer prior to the option expiring.)3.

I sympathize with your frustration, but this is a loosing battle and not worth the fight.

I want to go affordable, but don't want it to look too DIY.

@David McCauley I believe authenticity will get you further than a suit or car you can’t afford.