Very few non-owner occupied property policies guarantee full replacement cost - they typically provide replacement cost up to the dwelling limit purchased. 

He's changing the terms of the agreement, and you can choose to accept it or reject it.I don't think it's fair to pass this cost onto the tenant just because you are unwilling to stand up to the contractor.

I’ve had more success filling vacant units by word of mouth/ networking with other agents in my market recently than I have through the typical advertising methods.

More like a 101 of taxation: you had a reserve of losses -> it helps when you have profits.And a tax geek addendum:I also do not see a direct link to cost segregation benefits here.

I'm looking at monthly cost to seller vs. anticipated rental income, purchase price relevant to the ARV of the area and interest rate, balloon, etc.

@Jonathan SniderFannie and Freddie do have LLPA's and the lower the down payment, the higher the cost.

The CF is only playing catchup to the cost to you of the property. 

If operating costs increase, then customers/tenants will eat the costs in tight markets.

Here is an example of what it costs you to avoid professional advice.

That will increase your material costs for the job and is the contractor paying for the material in their bid or are you paying for it and paying them a labor cost.