A standalone ADU is almost always going to cost more than doing an addition, so the value added or cash flow increases will have to justify each.I work with a team of investors who will buy SFR homes then build a new ADU on the lot and add a separate drive way and meters for utilities in North Texas. 

There are many other angles also you can take to both increase profit, reduce risk, etc.

Quote from @Jamie Bateman: @Chris Seveney well, I don't want to increase the demand for the next trade, but with the HECM NPLs you get interior photos prior to bidding.

They will try to cut the FED prime rate, increase tariffs, and shake up global trade.

Hopefully you’ve increased rents and your above expectations. 

Here is the pro forma financials for the property……………they assume 150% occupancy and a 150% rent increase 9.

However if you are looking for options without points then you would either want to consider taking a higher rate or increasing the term of the prepayment penalty. 

I would discuss financials on this if you choose to come see the pre-rehab on Dec 1 (I have made a lot of money (close to 7 digits after this rehab is done in ~2 months) but due to not executing a cash out refi (due to the rate increases) my return is below my underwriting).

I use the Bureau of Statistics to find figures for job growth and population increase.

If so, do I need to wait a full year to apply the CapEx rent increase?