It's almost impossible to get deductible amount on some instances and owners are paying out of pocket.

Simply gifting him half the property now wouldn’t immediately allow him to claim the exclusion without fulfilling this residency requirement, I don't believe.One thought would be to use a HELOC to pull just enough equity out of the current home and use it to buy a smaller home, or at least the down payment.

great advice provided - what I will add to this is if you have smokers and its not allowed I would offer to allow them out of the lease with no penalty. 

It allows you, the wholesaler, to transfer your rights to purchase the property to an investor.

In real terms you would walk away from an investment long before a primary residence and therefore most banks will not allow it for anything less than 10%.

Quote from @Doug Teasdale: Quote from @Dustin Tucker: Hello Doug,  Here is the Arizona Association of Realtors Forms page.https://www.aaronline.com/manage-risk/sample-forms/residenti...You will probably need to use the Residential Resale Contract.For the Buyer as an example use "Doug Teasdale and/or assigns"  This allows you to assign the contract to your wholesale buyer.

You could form an LLC and have the operating agreement that allows your boss to require you to purchase his membership interest (or allow you to purchase his) in a given time frame.

After some research online, I am reading that the cost per square foot on a gut renovation of this nature in Stamford CT is anywhere from $150-$350, which is ultimately not very helpful, because at $150 per sq ft, this is a very appealing project with a total profit of ~$175K (46% ROI) and at $350 per sq ft, it very much isn't, because it would be a net loss of 83K (haha).QUESTIONS:What can I do refine my estimate a bit given that I am not allowed to a formal inspection on the property? 

This will allow you to mitigate risk on the first property but also allow you to do a cash out refi on the second, so now you have access to tax free cash that you can do with whatever you please.

@Apryl Skahill To get your risk-averse spouse on board with real estate investing, start by educating him with beginner-friendly resources that highlight the long-term stability, cash flow potential, and tax benefits of real estate, such as depreciation deductions and offsetting W-2 income.