If you build a buyer's list and you send them deals where the repair costs aren't close, you will lose them.

I purchased the home with a conventional mortgage and used the grant to help with downpayment and closing costs. 

A new ADU will cost over 120k to build and will not be appraised close to that from my experience and many other investors I’ve spoken with.

By the time I got to the closing table, instead of me bringing a check, they gave me a check.Fast forward to today, it has more than doubled from appreciation and cash flows a ton, and I was able to get a great property manager in there to handle EVERYTHING.

That 2nd requirement is  what makes it close to basically impossible with a W2 job.

Tenant estopple is a great place to start while you are in escrow, if you have closed escrow and did not do this stuff, you cannot backtrack.

Then you can immediately put a loan on. the free and clear property and pull that cash out to get close to what you need for the ADU. 

i'd pick a market close by, or that you have a personal connection to, or that you visit often.chasing cash flow by itself can lead to negative outcomes - for example, these investors bought in supposed "cash flow" markets:https://www.biggerpockets.com/forums/12/topics/1215726-break...https://www.biggerpockets.com/forums/963/topics/1195280-expe...https://www.biggerpockets.com/forums/48/topics/1137397-balti...hope this helps.

Try to stay close to the median home price for that city. 

That could be thousands of dollars, and you might not even close, so they just wasted several grand for no reason.