@Allen Watson it is cliché, but kitchens and baths are where it is at.

I actually helped a recent college grad that worked with me doing real estate deals just buy a 4 BR home, he finished a kitchen in the basement and one more bedroom, which added lots more rental income.

More details:--5bd, 2 full bath, 2 half bath converted into 5bd, 3 full bath, 1 half bath--1960s home, complete gut, open floor plan, new electric, plumbing, HVAC, kitchen, baths, etc. completely new house: higher end upgrades with everything tile, custom built ins, etc.  

I believe this house will require 2 new bathrooms, 2 new kitchens and some flooring repair.

I don't have a great window into this besides BP, but what I'm surprised at is the number of agents and lenders, who love to bask in Zillow's mistakes without seeing the larger point that you made: they are making an attempt to solve problems that have existed for home buyers for awhile. 

This summer we're planning on refacing the kitchen cabinets, new counter tops and sink.

Mine has roof, floors, appliances, hot water heater, hvac, exterior paint or siding, bath and kitchen remodel, etc.

We specialize in residential demo (decks, sheds, kitchens, bathroom, carpet and flooring removal), junk removal (garage clean outs, basement clean out, hoarded houses, etc), and we haul materials (gravel, sand, stone, rock and building materials).Please reach out our facebook page at Done Right Haul Away LLC. 

Each floor has its own kitchen.

Anyway I have about $135k available on my heloc. sale price on the duplex is $279,000, so 20% is about $56k. the house is perfectly livable as-is, but at $60/sqft and properties on the block selling for $140/sqft i think there is room for some forced appreciation. the building is currently a three-floor duplex townhouse, one unit is the ground floor and unit two is the top two floors. all floors are basically the same floor plan. the second floor has a kitchen/laundry stacked above the first floor kitchen/laundry. on the third floor, the room is in the same place and empty, but utilities (water gas electric) are already run and in place for adding a third kitchen/laundry, so conversion to triplex would be simple as installing cabinets and appliances and building an exterior staircase up to the second floor rear deck. the three 2bed/1bath units would rent for $1000-$1200 a month each, conservatively. we would have to find somewhere else to live for that to happen, but that is our 1-3 year goal anyway. would it be better to make the bank loan smaller with a bigger down payment from the HELOC?