Some important considerations include:The ADU should have a full bathroom, a cooking area, and a sleeping/living area.Some jurisdictions have ADU regulations, such that you might need a license before it can be rented, or a minimum acreage, or might only be able to rent an ADU to a relative.An investor who purchases a property with the intent to live in it while fixing it up could combine this with a house hacking strategy.

The ADU regulations were recently changed to be more lenient, which opens up your options. 

Also, with covid, there are more regulations as for sanitizing the space.  

Regarding other areas of the metro area, here's a post from a month or two back that I'll borrow from with links to the local areas' government rules/regulations that will hopefully be updated with the latest information.

I’d say buy him a beer but you probably couldn’t be farther apart. although I bought a home in Kelowna BC and did some lending there and basic exploration for developement that was back in 2001.and at least Kelowna was just as regulated as any city in the US.. 

They must be in different markets (actual regulation is more than 65 miles from your primary home and more than 65 miles from each other) B.

And thus you do not have to register with that state.Now as a caveat, maybe there are some other regulations that would apply that aren't listed here.

I would think there is a regulation on minimum heat levels in your area? 

Compliance is typically black and white regulation (and then gray once attorneys are involved).

Then it will be easier to use a new FHA.Although, I would recommend using a low downpayment conventional loan in this competitive market that we are experiencing it will be easier to win offers with conventional loans they have less regulations than FHA.