Home assessed at 400,000, but it's worth 500,000 realistically

[Luke Paul]

I'm talking with the person who has a house assessed at 400,000. But he added a couple more bedrooms and bathrooms and according to him is probably worth realistically worth 500,000. He would like to sell for around 400,000, but the thing is that he would like to rent the house for another two years while building another house across the street. I didn't know if this would be good for an investor to buy or not. Is it a good thing that there's already a for-sure renter? I don't know if it's good or not that it's not assessed correctly. Thoughts?