There’s a reason why throughout all of modern history more fortunes were created through or with real estate than anything else.

Also, I'd encourage building a modern home, which would be marketable whenever it's time to sell.

Think new floor, new paint, new fixtures, all updated little bits and pieces etc. that just make the home look modern/present day.

the 4 bdr side had good looking appliances, updated modern kitchen and recently redone laminate flooring that looked nice.

In our area, I would go with the 4/2 vs a 5/1. 5/1 is not conducive to modern buyers.

@Jason Tassinari its not rocket science, Its all about numbers.

We added value by way of a thorough update and modernization of the property.

As with everything on Real Estate or anything in life, we have to learn and it is not a rocket science.

Would that still be the case going from a very run down, needing full renovation, 3 family to a fully modernized and extended 2 family? 

And, of course, there wouldn't be the knowledge or investment without the worker in the first place, so people are always wanting to assign value to these less calculable items (like you, the investor, wants to assign value to the less calculable risks involved).At some point w complicating factors, and without degrees in actuarial science, most of us throw up our hands and decide it's easier to just split 50-50, 60-40, or whatever, assuming both parties are educated and comfortable with the risks and values over the life of the investment.