If your staying in the house long term, and the condition of the current furnace isn't great, plan ahead for the repair and do it on your terms, not when it becomes an emergency.

Do I go ahead with deal or cancel it?

Henri was two months ago and realistically the generator should have been repaired in that time, so that pushes responsibility back to you.

It's also wise of both of you to sit with an attorney and work through the scenarios ahead of time, despite knowing each other so well.

I will go ahead and adjust it.

I don't care who they have over there as long as they pay the rent on time and take care of the property.Imagine your bank harassing you because you allowed a family member or friend to stay with you for a period of time....or even move in with you.Pick and choose your battles, but if you want to die on that hill then go ahead. 

But next time push utilities onto the tenant.  

My landlord friend is a great mentor, he pushes me to get out of my comfort zone especially on these issues. 

Bottom line, I'm $100/month ahead.

I'm thinking ahead and plan to complete some much-needed renovation.