I have read that a bathroom is one place that putting a higher end flooring in can make a difference and keep the cost low because of the small square footage.

Comps shouldn't be done using median square footages or using an area as large as a full zip.

@Rachael Scott MHA fees are based on total square footage not just the lot coverage.

We have helped investors buy a small single family home (700 sq ft) and then helped them add s footage, to increase the value and max rents.

@Jonathan FelicianoI think the better choice is buy a 2/2 with enough square footage to internally add another bedroom.

Knowing that our house is zoned multi family I went to the city to find out what was possible. . .We are able to build a new structure onto our existing garage that can be as tall as our main home and 1/2 the square footage. 

We ended up adding a second floor and 800 square feet so since you are going to take off the roof and rafters add some square footage if you can.

Standard procedures should include MLS listing, yard sign, open house (either public or for brokers) mail outs around the listing, emails to their investors and other cooperating brokers, excellent COMPS/Available/expired lists provided to you, great photos--maybe even a video or drone footage-- and WEEKLY contact with you about the activity.   

The appraiser will make value adjustments based on differences in features of the property compared to the 'comps', (ex: bigger square footage would be a positive adjustment). 

With less square footage I'm estimating at the worse at $180,000.