I would agree if we were talking about financial statements, but as I understand it, we are talking about tax basis reports.For tax purposes, one can use a modified cash basis when filing.

It would be a undue financial restriction for solar on the ADU to produce that 15%. 

So, the value is that an investor has zero financial risk on the front end and spends zero time creating the opportunity.  

@Jennifer Fernéz I run sum numbers for you with our tool, see comments and pics below before refinancing and post refinancing .Financial Breakdown: Purchase Price: $200,000 Mortgage (LTV 80%): $160,000 Interest Rate: 6% (30-Year Amortization) Mortgage Monthly Payment: $959Upfront Costs: Down Payment (20%): $40,000 Closing Costs (3.5%): $7,000 Renovation Costs: $15,000 1 Month of Carrying Costs During Renovation: $1,548Total Upfront Required: $63,548Year One Rent: Monthly Rent Income: $2,000 1 Month Rent Losses during renovations (-$2,000): -$167/month distributed over 12 months Total Rent Income: $22,000 per year => $ 1,833 per monthMonthly Expenses: Mortgage Payment: $959 Property Tax (Assuming $3,000/year): $250 per month Property Insurance (Assumption): $100 per month Utilities (Hydro, Gas, Water): $275 per month Assuming 5% Vacancy: $92 Assuming 0 % Repairs & Maintenance first year because unit has been recently renovated Total Monthly Expenses: $1,676Monthly Net Cash Flow: $157Post-Renovation Refinancing Strategy after 12 months:So far, we’ve purchased the property, completed renovations, and rented it out.Next, you can approach the bank for a refinance to consolidate a portion of your initial investment into a mortgage.

They will do magic for your financial situation.  

If you need financial help, ask under the "Finance, Tax, and Legal" forum.

If you need financial help, ask under the "Finance, Tax, and Legal" forum.

The seller does get benefits, but they aren't necessarily financial.

Just make sure the numbers work for repayment and your overall financial goals. 

It means your house might be your biggest financial asset — and it could open up some exciting opportunities for your future.