I think the catch is that it only covers damages that are considered beyond normal wear and tear.

More wear and tear to be expected in the end but if you sign one year agreements and check the property often enough it can be managed well.Hope this helps!

It could be a very serious issue.The municipality could require you to tear out the divider/addition.The municipality could fine you, sometimes these fines are a daily fine.Or the municipality could condemn the property and not allow you to use at all either as an owner occupant or as a rental.

@Paul WolfsonIt’s not impossible that by getting a permitted ADU that they will ask you to tear down the Guesthouse.

I would say sure with addendum to lease Add a few hundred per month for more wear and tear and still hold your actual tenant responsible for everything

Purchase price: $205,000 Cash invested: $7,500 Tear down and rebuilt What made you interested in investing in this type of deal?

I feel they are renting a slightly shabbier place every year (the fact that their wear and tear created the shabbiness is irrelevant) so at some point they will see moving as trading up and if they get it for the same rent they may do it.

If there are signs of wear and tear, I totally get it.

At least there is a GFCI circuit breaker at the panel.During the summer the double pole thermostat is then flipped to the max temperature to trigger the feed but the wall heater is turned off at the heater so the feed is now only live to the a/c unit.Access to do a separate feed to the a/c is not possible without tearing out walls.It's an interesting concept do you have any Suggestions???

@Neil Furry I'm under the impression that most insurance companies don't cover roof repair due to wear and tear.