You’ve got to be more creative in your lead sources and underwriting.A few things I’ve seen that still work:Off-market deals (especially tired landlords or inherited properties)Novation opportunities where you can lock in equity without needing to close firstHeavy value-adds in up-and-coming pockets just outside the core (like Madison, Bordeaux, or even parts of Antioch if you can get in right)The key is going in with enough spread.

But if we’re talking about STR investing from a return-on-capital standpoint, the numbers aren’t compelling.$180k gross on a $2M purchase isn’t just “middling”—it’s frankly poor.

Marketing Effort: High-quality photos, a compelling description, and fast responses go a long way. 

Unless there is a compelling reason that a potential buyer would need seller financing to close this transaction, I think you would be better off selling it conventionally and moving on to your next investment.John

@Art Schneider You're on the right path — that’s the core of the BRRRR model.

High Rental Income Potential;       In LA County, you can expect average ADU rents around $2,050–$2,550 per month for a one-     bedroom unit.On a construction cost of roughly $150,000–$220,000, that translates to annual gross rents of $24,600–$30,600, or a 7–15% cash-on-cash return before financing.Strong Property-Value UpliftHomes with an ADU in Los Angeles often sell for about 35% more than comparable properties without one.For a $800,000 home, that’s roughly a $280,000 increase in appraised value after adding an ADU.Solid Cash-on-Cash ReturnsEven paying cash, you can net 10%+ annual returns on your build cost from rental income alone.And financing the project can still leave you with an $8,000–$10,000 annual net gain after mortgage costs.Resilient Demand & Market DynamicsLA’s tight housing market keeps vacancy rates low and rents high, supporting steady occupancy.Regulatory reforms have streamlined ADU permitting, cutting wait times and softening approval hurdles.Tax & Incentive BenefitsYou can deduct mortgage interest and depreciation on the ADU, improving after-tax returns.Energy-efficiency or solar incentives can further lower net build costs.Things to keep in mind if you already own a property and can't afford to buy another.Upfront Costs & Timeline: Expect 9–12 months and $150K–$250K all-in.Permitting & Utility Upgrades: May require separate electrical sub-panel, meter, or sewer hookups.Maintenance & Management: Factor in insurance, taxes, and occasional repairs.In Los Angeles’s high-rent, low-vacancy environment, an ADU typically pays for itself in 6–10 years through combined rental income and increased resale value—making it one of the most compelling "home-owner" investments today.

If you're replacing multiple doors, consider choosing the same style throughout to ensure a cohesive interior design.Solid-core doors are a strong choice.

Yield on Cost: Understanding the DifferenceAt its core, the difference between cap rate and Yield on Cost is a matter of perspective: one is about selling, the other about building.Cap Rate: This is the market’s valuation tool.

@Shirin Namavar if it was discovered in the inspection and shared with buyer, it should have compelled disclosure.

“I rent a 3-BR home in the urban core to a single mom with 3 kids.