With this scenario we both have skin in the game: His work and my materials.

For rentals, they can work well if the HOA is investor friendly and cash flow numbers make sense.Financing can also vary, so it’s worth checking lender requirements for condos (warrantable v non warrantable) versus SFRs

It varies, but when retainage exists that will drive up the cash to continue to advance the project because borrower won't be receiving draw releases equal to their outlay. 

In addition- if it's not working and the tenant takes legal action, the judge certainly isn't going to be on your side when you tell them a flooring contractor said it was warm in the house.This game is all about mitigating your risk by being proactive.

If you’re looking to build long term wealth, accumulate assets, take advantage of tax code, and benefit from appreciation, then play the appreciation long game.

Selling "Golden Tickets" has proven a dangerous game for many through-out REI history.

I may have to start smaller and that's ok too, at least I'll be in the game.

You can only play games for so long.Chances are your next door neighbor is an IRS agent and turns you in when your tenants blocks their drive or some other random event disturbing your IRS neighbor.ADU catches fire and your insurance won't cover you, because it was an illegal and unpermitted structure.The city inspector told the last guy not to build or rent it, and is now pissed and wants to make an example of you and just red tags the whole property and no one can occupy for the next 1-2-3 years while you wait for a hearing.Then when you get the hearing, "staff" recommends you tear the whole structure down, and if you still want an ADU, you can apply for a permit and rebuild it.Your tenant quits paying rent and won't move out and you can't evict them, because there is no valid lease and they're just your "roommate".Probably a dozen other bad things can happen to you when you do stuff like this. 

If I end up foreclosing the property, I will gain $200K equity (in my example, the amount will vary with each TD).

Partnering with the right investment Realtor can be a game changer—they’ll help fill in the gaps, give market insight, and bring you deals that best match your strategy.