I would assume a greater emphasis on quality of materials and workmanship (and consequently higher rehab cost) for a rental where the investor will have to deal with the longer term implications of any corners that were cut.

I don't expect material improvements until 2026 at the earliest. 

Sometimes the contractor will put a % on the top of the materials to source it.2) what's your range for remodeling a bathroom?

In that case you should get an attorney involved as encroachment would be a material issue that if known should have been disclosed both to the broker and to any potential buyer.  

I would need to know more specs on the house but with material shortages It's difficult to say how much to budget. 80K-120K for full gut perhaps but unsure with lumber beings so expensive and shortages.I would plan 9 months of vacancy between the pain you will endure pulling permits & having your contractors show up everyday to complete the work & then final inspections to get a CO. 

You could argue that your property has not materially improved and does not meet the same value as the most recently sold properties.

I came up with $385,000 to build for material/labor.

How are they sourcing materials?  

Most are flimsy, thrown-together with uber cheap materials. 

Ran into many problems with contractors along the way, paid for some material twice as well as some projects to be redone.