Those enormous tenant buyout amounts were feasible before the 2019 rent regulation act. 

These carriers are not profitable in CA and CA laws and regulations do not make it easy to mitigate these financial struggles. 

One of the concerns would be, how long would this last until regulations catch on?

I'll add this, I think if you are good at it, there exist modes and methods which can give you much better returns. 

@Benoy Varghese When I take over a property I send a letter to the existing tenants introducing myself and telling them where to send rent and provide the necessary information regarding my policy for dealing with maintenance issues.

Problem was it's a common perk for Chinese restaurants to provide lower paid staff with room and board, and without the upstairs apartment, renting an apartment in nearby towns for staff is a problem with rooming house regulations beside a major expense.

These don't require you to live in the property, so you could close with the existing tenants in place and then move in once their leases expire.

Prices there tend to be fairly high so make sure the financials make sense to you.If you're going the townhome route, make sure you fully understand the rules and regulations of that particular community.

However, seasonality still exists and the summer is low season.

Also, I'm not sure if you are demoing an existing structure, if the structure is freestanding, etc, but this will obviously greatly affect your overall budget.For our project, most of the material prices are in line with expectations, but where we've been shocked with recent increases is the soft cost.