To say it another way, if the market that you're looking in is saturated, simply look at another market :)Happy hunting!

By simply opening a wall & installing a doorway the city allowed it as well as leaving the second kitchen etc in place. 

I am not a lender nor do I have any referrals; I am simply trying to get advice while I embark on the same type of business venture.

But is it possible that you're simply not getting enough of the water away from the house when it rains?  

There's simply no way to make this cashflow as a rental property with a 10 year, $40,000 fully amortized note at 5%.

Although, eventually we would like to branch out to the Gulf Coast (Gulfport, Biloxi, New Orleans) simply because we fell in love with the area during our time there and still have many ties.

Are you content to spend nearly a year attempting to locate your next property in the LA market or do you have a plan to accelerate that process?

You expressed an interest in wholesaling and as such I added a guide below.https://www.biggerpockets.com/renewsblog/2015/01/31/ultimate-beginners-guide-real-estate-wholesaling-2/ (Ultimate beginners guide to wholesaling)To be more successful, you simply have to work on the other elements to progress your REI pursuit.

I have been educating myself in the process and have already made some attempts at obtaining properties.  

it is not a quiet title simply because that is the cost I am trying to avoid, and that is why I sell them much cheaper.