They will have additional costs for mailing & online campaigns to get leads.

That would be a helpful addition to your plan as you would further reduce your cost of living.Also don’t forget from that $600 you are planning on getting in cash flow you have taxes, insurance, maintenance, capex, and vacancy to consider.With two homes, you may want to keep that extra $20k as an emergency fund rather than spending it on a third property and then be left with no emergency funds.

I see price reductions daily.

Purchasing the LLC gives you ownership of the property, but it also opens you up to additional legal exposure since the entity has been active, and there is no way to really know for sure what else they used the LLC for.

With the economy of scale in multifamily, each additional unit nets you a little more than the last, as a rule of thumb.

This sounds risky, are you being compensated by additional rent and have you checked with your insurance to ensure you are covered. 

I was fine with all these numbers.Then I met with contractors...First, I wanted to add a new bathroom and approximately 450 sq ft of additional living space.

This doesn't account for transaction costs and reduction in leverage as you pay down the mortgage which accounts for closer to 2-3% less, so you 12-18%. 

Would love any additional info and the chance to check it out! 

If you have any additional advice please let me know!