He is able to charge 14/4 because there is no lengthy paperwork, if your deal is good enough you don't have to put any money down, and while it may be expensive, you know he will be there with you at the table for closing. 

[FYI- The township of Bloomfield, NJ Uniform Construction Code: 149-8 has a lengthy document on construction fees & 149-3 has more info on Certificate of Habitability (Occupancy) fees].   

@Scott Skinger thank you for the lengthy reply, some great info there.

I was privy to a lengthy memo authored by one of the head honchos at First American Title that outlined why they won't do simo closings anymore.

With that lengthy preamble, here are my questions:- Is it better to put down 20% on a lesser property; or to find a better investment, put down a smaller % deposit, and use the leftover cash to finance the rehab/construction of an ADU?

This is lengthy, but I've been enamored with the BP podcast and blog for about a year, so I've built up a few things to talk about.

A not so bad and entirely expected worse case would have been a lengthy eviction on top of a mess.In your list you've included nothing for vacancy, and, unless you're very lucky, you will have vacancy.

This post may be a bit on the lengthy side, but I am hoping to provide a full picture of my situation as well as hopefully be able to aid other local investors in my area.

my VERY brief answer is "different strokes for different folks and both can be beneficial and/or costly"....I am going to come back to this thread when I have more time to read all these lengthy replies as this is a great topic and I would like to add my 2 cents in more detail.

However, a VR for the right person, might make a lengthy trip more cost effective to the business.