Once you have those numbers, subtract your ARV, less selling costs (6% realtor commissions, closing costs, buyer assistance, etc) and you should arrive at your profit.Per your last comment, using hard money will make it harder to find good deals, since it tends to be very expensive money and you are likely competing with cash buyers who will not have to price in the lender fees and interest.  

If financed, the loan payments need to be subtracted which at 3%, 30 year is an over an additional 4% of the home value annually (but there is some equity paydown). 

We also sometimes use the model from Flip Your Future (take profit desired and subtract expenses to get max offer).

My conflict is this,I am not sure if buying commercial will add or subtract value to my rental business or hinder my growth by slowing me down significantly with the financing and cash up front. 

You subtract all your costs for the remodel and selling costs.

Then, once you are done with that, subtract the monthly mortgage expense.If you need to learn how much equity you will pay down, you can input your loan information into an amortization calculator.

So you subtract your mortgage and 25% equity from the $200,000 and the bank would lend about $50,000 on that property.  

There are a few more expenses than just the rehab.PURCHASE PRICE +Inspections +Lender fees (points, etc) +Rehab +Mortgage Interest +Property Taxes +Insurance +Utilities (power, water, gas) +Maintenance (pool, landscape, etc) +Staging, if applicable=PURCHASE, BUILD, & HOLDING COSTSAfter that you take your sales price, subtract out commissions and seller closing costs, then subtract out the figure above, and now you have your net profit.

Obviously there’s no risk to PM as they will simply subtract it from the rent they collect.

With ADUs I have seen valuations all over the place (I have not figured them out) but the one that seems to be most prevalent is to have the ADU add $50k to $80k then subtract for any subtractions (in your case the loss of the garage would subtract from the value they assign for the ADU) with a primary factor being how much the units appear to be unrelated.