If you can afford then I would include a bonus of say $1,000 or $500 dollars if he finishes the work ahead of schedule.

As far as I'm concerned, positive cashflow is the price of admission for a long-term buy & hold and appreciation is a bonus.

The numbers i had were assuming replacement of the roof so I guess I was shrugging it off because I was assuming it needed to be replaced but it would be a bonus if it didn't.

You have to build all of these into your accounting for profit and loss.Look at appreciation as a bonus and not a guarantee.

I guess one option is for me to live in the last unit for 2 years to get the 250k tax-free bonus, and meanwhile use a equity line against the unit to continue investing.Andy

That way, he at least knows for 4 years he is going to get his 8% and if he doesnt he will get a bonus.

If you already like the deal and have an opportunity to get a discount, that is obviously a bonus.

They also mentioned something about bonus depreciation as well.....

I'd like to tie this 'bonus' to the sale of the house, but I don't think that will help him, based on what he has told me.

I assume you can't structure your trading income as a salary with a bonus relative to profit with the person providing the capital (and maybe a forfeiture of salary if you don't make anything..)?