I appreciate you thoroughness in the matter but we will handle everything as far as that is concerned and give your buyer a clean title at closing."

I’m trying to get a better understanding of the unlevered IRR hurdles SFR / BTR investors have for value-add improvements.By "value-add improvements" I’m referring to upgrades made to a property that increase rent or purchase value, often including kitchen remodels, bathroom updates, solar and other energy efficiency improvements, fresh paint, a new garage door, finishing a basement, adding a deck, and updating flooring, to name a few.I’ve been hearing a lot of different reactions to this question the last few months.

@Mad Dendukuri easy solution - tell the tenant you can't afford to do flooring AND put them up somewhere, so deal is off.Either they will be reasonable or show themselves to be greedy and someone you should get rid of.

Replaced the carpet with hardwood floors & new trim, painted all the walls, and completely renovated the bathroom What was the outcome?

Option 3 may sound tempting to you, but before considering that route I would interview prospective property managers and house-cleaning services in the area you are considering.

I have some recommendations for you if you are needing a painting contractor, flooring contractor and a roofer.

We ended up buying one house to turn into a vacation rental and the two other options were one- a stand alone commercial building and two- a ground floor unit (currently occupied with a tenant for another 3 years) of a building that is in the process of being turned into condos. 

After all PITI, utility, and services (lawncare and cleaning) costs I have $7,225.I set aside 25% of this for my maintenance fund.The remainder funds my lifestyle, wife has a Tesla, and quarterly vacations as well as business growth.In 2023 I am tracking to build 4 duplex units designed as room rentals funded in part from a recent land sale.

Quote from @Marc Shin: For my STR, should I be using waterproof LVP or regular tiles for the bathroom floors?   

I think the general idea is that areas like finished basements, or cape cods with sloped ceilings on the 2nd floor have finished space that is not equivalent in value and use as other finished spaces.