Wondering.. do I need to get any permitting or anything to add electrical to the room, flooring, closet, and make a small room?

I'd go with a lighter flooring and backsplash as the darker finish on the cabinets will make the room look darker. 

Living room was converted to a master bed with walk in closet and and bathroom with heated floors and walk in shower.

If your flooring isn't pet proof it won't be tenant proof either and excluding pets only serves to limit your tenant pool.

Should be evaluated by specialist.11) Water staining present on the ceiling in family room in main house where the roof seam meets between the main house, and un-permitted area12) A few closet doors have been damaged and need to be replaced.13) Another window needs to be serviced because it won't shut14) Need to add fire alarms to bring up to code15) Looks like the kitchen needs to be re-done16) Bathroom repair- fix some slight leaks, a couple toilets, re-do caulking in tubs, re-do flooring and base moulding17) Recommends replacing water heater, and HVAC.

The house has 1800 square feet but desperately needs new flooring and I was so happy to save putting 6K into new flooring. 

Let's look at floors.

I have two potential floor plans picked out that would work nice on this size lot. 

Each side is a 4 bedroom/1 bathroom with original hardwood floors, pocket doors, and large rooms.

Renovations to the kitchen, bathroom, exposing the hardwood What was the outcome?