Anyone who understands appraisal? Will duplex-turned-SFH be appraised less?

[Bora Moon]

Hi, all

The property has two houses on one lot, so it's already a multi-family on surface. But the two are each single family houses. The bigger house is two-story building already with separate entrances. So I'm thinking to add a kitchen on the first floor and make it a separate unit. This will bring in more rental income but I'm curious if that'll have a negative impact on its appraised value. I read that multi-family doesn't compare apple to apple with sfh and there's less purchase demand, so it may appraise less. It is in a mostly sfh residential area so it doesn't have a direct comp nearby either. 

The reason why I think it makes sense other than the additional rental income is that current floor plan is really inefficient with the stairs and dead space. But given the renovation cost and potential disadvantage on appraisal, adding a bedroom to make it a 4b2b sfh might work just fine.. 

Anyone familiar with appraisal that can provide input on this? Appreciate it! Thanks!