Additionally, your brother would inherit your cost basis for the gifted portion, potentially leading to higher capital gains taxes if he sells later.

$540 is not unreasonable for a home of that size and the items you mention.

Zoning Ordinance ExceptionsSome properties in the target zone don’t meet the minimum lot area or width size requirements under the zoning ordinance, yet houses exist on smaller-sized neighbor lots.How could these properties get approval for development?

If scaling quickly is your goal, DSCR loans are a great tool for the refi portion since there’s no 12 month seasoning requirement like conventional loans, and DTI isn’t a factor. 

Seller will owner finance the portion she can.To those who have been walking down this path, how are you funding these projects?

I'd be happy to assist with the financing portion (if you are considering here in HI).

The property itself should bring in revenue ( even if you choose not to live in one side) and generally a bank will accept a portion of that rental income into the calculation. 

So if we were to assume the loan, we need to take a second mortgage to cover the equity portion of the loan.

Almost every reputable lender is going to have a draw process for any lender funded rehab portion. 

I will definitely talk to her if she would give or sell me her portion. 4.