Otherwise in our example we would be paying more (we live in the 350 square foot ADU). 

You don't get to keep that income tax free...If you have to lie and cheat to get the property to work for you, I would just pass on it...you're starting off on a bad foot and will just lose the money you save later...And like @Jonathan Greene said - how did they get a COO without a permit?

You can also create a basic scope of work and get ballpark estimates from contractors or use cost-per-square-foot averages for your area.To determine ARV, look at recently sold comparable properties in the area that are similar in size, style, and condition to what your property will be post-renovation.

Is this needed or even worth to get my foot in the door with landing Multifamily deals? 

I’m Julian, been in the game a few years now, grounded in Omaha but I’ve ended up helping investors find their footing in places like San Antonio, Austin, and Phoenix too.

A french drain typically costs around $25-$30 per linear foot.

They're basically shooting themselves in the foot.

Truly sad part for Clayton is he could have been one of the largest if not the largest re seller of turn key homes in America.. he still Is at it but man he really shot himself in the foot by not owning this stuff. and for sure he knew what was happening one cannot hide behind the fact that investors and anyone just doing a cursory drive by of a non rehabbed home that was suppose to be rehabbed.. any way.. should be interesting to see if he gets away scott free other than defending the multitude of lawsuits that are no doubt pending.   

It's a perfectly linear relationship.

In this list there are 5 cabins between $137 to $178 per foot (PSF).