Security Deposit: 2600Lease states no smoking/painting walls/no hanging things on wallsTenants have moved out and have left two truck loads of garbage to be removed.Damaged doorPainted walls which got on the ceiling and trim Lots of holes on the walls throughout the houseDamage from windows being left open constantly Weed was clearly smoked in the house (smell throughout the place) so we need to deep cleanWater bill wasn't paid so I had to turn back on utilityMissing keyQuoted costs:$450 junk removal (some furniture)$935 for damaged doors/windows, painting cleaning$30 for utility turn onTenants were only there for a year before moving out so a lot of this is beyond normal wear and tear. 

In the beginning I want to manage by myself to save cost.

Based on my experience of running properties, even if the build were to cost you as much as $600k but you could generate $125k/year, you'd be very happy with that investment. 

The rates are high right now but these loans are limited based on cashflow so you cant take a loan that costs more than you're receiving in rental income.

Cost overruns were tremendous.

. :) A zoning change can take up to 6 months, approval isn't guaranteed (despite Aldermanic support), and potentially cost a lot of money (architectural site / floor plans & dimensioned elevations, zoning attorney, holding costs, etc.) 

Your cost basis would be ALMOST zero if you ever sold.

If you own 25% or more of any LLC you are required to register with a FINCEN ID for beneficial ownership by January 1st or you could be subject to $500 per day fines.Have you taken care of business?

Seller Pre-Sale Financing: Consider selling the tenant-occupied property "as-is" now to an investor, perhaps at a slight discount, which could save time and eliminate renovation costs.

We just need to verify that you have cash for the downpayment, closing cost, and up to 6 months of the mortgage payment as reserves.