Another factor to consider....think about the next landlord.......anything you can do to have an official record of their "deadbeat" status may very well help the next guy in line by giving them a heads up before they even rent to them.

From an operations stand point, make sure the quote from the contractor includes — full containment and HEPA filtered negative air movers that ideally can exhaust to the exterior, manometer with print out logs documenting the containment’s negative pressure throughout the mitigation, full removal of affected materials (drywall, baseboard), (wood framing can sometimes be sanded and then sprayed with a spor/fungicide), and finally an *inspection by a third party environmental hygienist for air clearance*.

Though he has more experience with rehabbing this is not something you need to factor in to your answers as it isn't something that will influence or affect our agreement financially or at all.

Location is a huge determining factor because the difference between a nice and reliable tenant pool and a bad one can be a matter of a few blocks.

If we split costs 50/50 for everything, how do we factor that in to our taxes since each individual will have a loan in their name but the costs and profits are split?

of course there are many factors to consider.

I would not touch it and list it on zillow as an income investment or an ideal house hack canidate and the reason why is because i experience an endless stream of folks who pay too much for rehab properties, not knowing the real cost of fixup. 

Ideally, I'm looking for duplexes or triplexes within the Oakland area, but willing to stretch out to San Pablo or down to Hayward (i.e. 20mi radius).I'll be occupying one of the units and would prefer something that isn't turnkey.Thanks in advance. 

I could add a new separate switch outlet which would meet code but is less than ideal.

You apparently knew about these problems when you purchased the property so did you factor them in and now you are second guessing yourself?