But the reality is, you can't assess these both in a vacuum and say one is one and the other is the other.  

Im in Massachusetss so I had Mass save (program to help with energy usage paid for by the utility companies) come through to do an energy assessment and identified there is little insulation in the entire building and that there is a lot of knob and tube wiring throughout the property.

@Basit SiddiqiYou came to the right conclusions when it comes to LTRs, although there are always exceptions and deals to be made/had.I don't agree with your assessment of the economy being poor though.

A qualified home energy assessment will determine whether the improvements are cost effective.

The realtors always hike this since they and buyers think with a higher purchase price the Auditor will hike the assessed value and thus the taxes. 

It's not our job to assess the potential longevity of a couple's relationship or whether one partner may file for divorce or leave the relationship within the next 12 months.

. - the seller gets the equity and I'm also paying property tax on a higher assessed value (vs. if I bought a distressed house at a much lower price, that I renovated)I'd be cautious buying old homes (e.g. 100 years old) that have been renovated.

So, you may want to call the assessor's office and talk to them about your "theoretical scenario" (rehabbing a place to add a bathroom and room, but not adding to square footage) to see if/how they would re-assess.

One piece here is that yes you can potentially find buyers that will have a premium for successful track record + even furnishings, listings, review - but important to remember that there won't be a premium assessed by the lender in almost all situations if the buyer is using financing to acquire - their loan will be based on the pure real estate value even if they are paying more - just a tip to keep clarified so no surprises that can throw off deals

Don't forget to research local regulations surrounding MTRs and STRs, factor in management fees if you plan on outsourcing, and assess your risk tolerance between a larger, single multi-family property or multiple, potentially distant, MTR/STRs.