Figured there would be a few data points left out of the equation' that I would need to circle back with :) .There are additional units not rented at this time which could be rented to increase the income.

In San Diego at the current rates for a purchase loan (which has better rates than an ADU additions) at high LTV, I show 1% does not cash flow on a sustained basis.  

Additionally, there typically are additional state protections (outside of the agreement) based on where the fund is located.

Duplex have different zoning that may permit additional units.

This is due to bonus depreciation which allows taxpayers to deduct 40% of qualifying property costs in the first year, in addition to regular depreciation for new construction and improvement.

My budget is in the $200-250K range.Please feel free to let me know if additional details would help, and thank you in advance for your time and advice! 

Return:Finishing the basement and adding bedrooms can add significant value, especially if your local market places a premium on additional living space.

IMO this is much too little additional return to put your personal residence at risk.  

In southern CA, even garage conversion ADU additions are typically costing more than the value added.  

Am I getting greedy to ask for an additional seller credit at closing to help offset some of repairs needed?