I am now pretty concerned that this is a risky proposition, as rates could continue to climb in 6 months/1 yr during my renovation. 

My proposition to you: Challenge yourself! 

He has a unique value proposition.

I'll never forget my conversation with a (typically very smart) tenant who was so happy that a bunch of clean air/water/daycare/parks propositions passed.

That led to the tax revolt of Proposition 13.In some jurisdictions, as a sop to taxpayers, the local officials reduce their tax rates by a small amount each year, but never enough to offset the big increase in tax collections created by higher assessments.

Your unique selling proposition by offering rooms for rent is the ease and flexibility of moving in.

I know that a lot of new information can be presented as fact when it's only a proposition.

If your value proposition is solid, don't drag the other party uphill, move to the passing lane and move ahead.

This seems like a far less risky proposition considering the seller’s market we are experiencing.

Look at the shift in the market, improvements made, value added and if the value proposition is favorable, negotiate a transaction.