For flipping you have to be in a viable market that produces such opportunity. 

He assume each unit produces $200 per month cash flow - $9600 per year.   

The REAL issue is the EXPENSE in producing new units. 

That is for, if necessary for us to sell our existing home and move to the number one produced, which will be the first "model home".

I think that, regardless of the deal you have with the seller, the primary lender that you refinance with may not like you having a 0% equity stake in the property, or very tiny equity position of less than 25%, and may require you to reduce or eliminate the "junior lien" or whatever you want to call it that is this seller carry item. 

That is for, if necessary for us to sell our existing home and move to the number one produced, which will be the first "model home".

A primary home is not an investment, as it's not producing you any return other than appreciation which you have access to only selling or taking out loan.

In my state, we have to produce an itemized list of all expenses that came out of the deposit within 30 days of tenant moving out.  

This must produce positive cash flow to protect downside. - Understand the upside of the "rent by the room" strategy- Understand the upside of any repairs that can be made to the main unit. - Understand the cost/value of completing an ADU project- Underwrite mid-term and short-term upside cases as well. 

Another option is purchasing land to add a type of tiny home, trailer, RV, Etc.