Seems the seller just wants you to have more meat in the game, more commitment to actually close. 

Or, he's cooking the books.I would probably work with my lender to sort out how they will respond and what numbers they think are right and will support in underwriting.Then the conversation goes, My lender is concerned with the large delta between reported and estimated income and will only write this deal based on the reported income (or whatever they decide), as a result, I can only support this purchase price. 

Given about 4 drinks per week he buys off me at an average profit of $0.50 average per drink I make around $2 a week after expenses. $8 per month is enough to buy 2 different 12 packs of my wife’s favorite soda pop for the month so for the little labor of picking up a few extra cases of pop and keeping them in my trunk we have effectively “soda hacked” our way to free pop!

But they do cook a LOT, never turn their lights or TV off & run their window-shaker a/c units 24/7 all summer.

I’ve gone both ways, usually the lease is good enough for me and would probably hold up in court, at least in my small midwest county, but Cook County is a bit more tenant friendly.

You could also take them down yourself and wholesale them if there's enough meat on the bone.

I can afford the down payments, I just have the feeling my debt to income ratio will catch up and banks will eventually not want to lend to me. At

The contractors doing the work need a place to sleep, cook and do laundry.

Buying new to avoid maintenance issues is a steep price to pay especially when a bad tenant can ruin the new carpet in a matter of 6 months and cook with excessive grease and cause your new appliances  to look very used in no time.  

I'm going to figure, however, that at the 30 year mark the FV of those 15 years of additional cash flows will have earned me at least what I would have paid in taxes.