You can also, unfortunately, not deny somebody who wants to rent a one BR with 3 kids if the apartment is big enough square footage wise.

I know there are some commercial insurance providers that are more geared towards large multi-family projects and have a base charge on total square footage and then a "per unit" additional charge . . . at what point does this become the right approach for SFR portfolios?

It can be based on square footage or on room count.

We decided to close in the porch to add some sq footage and convert to 3/1 as well as convert the jack and jill bathroom to give it direct access to the common area.  

Sounds like your property had a bit more square footage with an extra bedroom at the same rent.

Would you be able to share any data on square footage and improvement cost per sq ft?

@jamesTo expand on what @Linda Weygant said about the home office deduction no longer being an audit flag, the IRS now allows a "simplified" method where you simply multiply the square footage of the office by $5 and that's your deduction.One has to think that if the IRS is offering and encouraging a simplified method of reporting, it's not going to be the cause of an audit.

I spoke with the owner of another remediation company who had given a bid on the remediation (just by walking around and measuring sq. footage).

My thought is to go ahead and finish it out the garage as a full conversion with a half bath so we can add to our total square footage and room/bath count.  

Do you find that you have to offer cheaper rent to get them rented if next to other other 2 story homes  of similar  square footage ?