I've seen lenders get more strict on that recently with the pandemic going on.

That town is strict about zoning and would not guarantee the use would be grandfathered and the property ended up having many other serious issues (flood zone, downstream from an antique dam on a river with a history of flooding and bridges and dams being washed out, the rents were below market, there were three code and zoning violations in the use of the barn and a mildew smell in the house. 

They've recently become much more strict about "checking to be sure you actually live there", so you'll want to play by the rules if you're going that direction. 

While there is truth to that in certain regards, it's tough to do that in syndication because there are strict rules and regulations that must be followed when raising capital.4.

If I am understanding and calculating everything correctly...Initial Investment: -$42,577.50Cap Rate: 4.93% Cash on Cash: 2.45%Not sure if I am approaching it a bit strict.

Obviously, you will follow a strict and conservative underwriting guideline so that you don't overpay but waiting should never be a strategy.So, I won't hold my breath if I were you.

Garage conversion are a little more difficult because of the cost and ADU restrictions (increasingly more strict because of STRs).

I'm not concerned much about USAA and their polices on "too many claims were are going to drop you" although I've heard they are pretty strict.  

However right now I have the capital to buy an additional strictly investment property.

The problems that come up during our everyday business dealings may seem routine to us but could represent a major pitfall for someone who is not used to dealing with them.