In many cases these were upgraded, remodeled, add ons etc.

Here's what I've done so far: (1) someone responds to my add on craigslist and I email them pre-screening questions (name, number, reason for moving, # of people & relationship, intended rental term, occupancy date, smoking, pets, approximate credit score, occupation) (2) they write back and if there aren't any glaring red flags, I call them & ask if they would like a showing (3) have the showing & give them application to fill out.That's as far as I've gotten so far.

You can add an ADU and/or convert a garage plus add on a JDU to any SFR and the restrictions for property lines are now just 4 feet from fence/property line to the ADUs, with no additional parking required.So, you may be able to turn all of the SFRs to tri-plexes. 

It had a $20k value add (only one unit was trashed enough to have a good return on a rehab) that would add ~$45k of value.  

In the same letter provide an option to prevent this extra $50 per month by requiring tenant to add on the roommate. 

I don’t want to pay to replace it then remove it 2 years later to add on an addition or a 2nd story.

@Toks FifoJust to add on to everything already said:Don't forget the power of paying off a loan over time. 

I'll add on to Chris's post above as well. 

This is my starting point of negotiation.Your calculation is fine right up to the point where you add on the down payment.

Pop an add on Zillow, screen clients for good credit and job history, you're good to go.