What about the third option: not able to be deducted by both parties?

Hint: this is now the third time its come back in my lap.

As I mentioned I would strongly consider adding a third bedroom to the other unit if the current tenant is to move to increase rent as well.

The agent value comes in analyzing the value, neighborhood trend/knowledge, how to read/research the seller as to motivation, protective and trap clauses in the wording of the contract, which lenders actually perform, which title companies to avoid, which inspectors to use/avoid, how to negotiate when problems occur prior to closing, etc, etc.....all of which You you are not experienced/competent in.So, You decide.

When you analyze your equity position pre and post project (acquisition) - the longer the project takes you, the worse you're doing from a performance perspective on that equity analysis. 

So here's the ultimate conundrum:- sometimes I pick a few benchmark properties in my target area and track them to see how they're performing, BUT... you never know which dates are true revenue dates and which are simply the owner blocking the unit for their use!

Please note that he is obligated to pay back their 401k loan (regardless of the performance of his real estate investment with you).

Some states will allow homeowners to perform their own electrical, etc.

My private lenders know that I can perform so it’s all based on a handshake and trust.

Tell him going forward to field ALL repairs and ALL requests (dog, pool, stripper pole, you name it) to you BEFORE any work is performed.