Essentially you “bet the company” based on your assumptions being right, because you only have one shot to make it pay, and ultimately the amount of “unknown data” is equal to the risk you take.

I am considering purchasing the rental we have lived in for the last few years. In order to save on realtor fees, the owner is willing to knock off the 6% realtor fees from the appraisal price. Are there any advantage...

You are essentially creating your own sweat equity in the home.  

And if so, essentially pulling out prior to six months (even when including rehab costs) means you’ll only get back a max of 70-80% of your initial incestment.  

Essentially I bought a foreclosed duplex property for 270k, and wrapped the 80k rehab into the 203k loan so my total loan amount was $350kAfter I rehabbed it, it reappraised for $500k, so I had enough equity to refinance out into a conventional loan.

Essentially I am looking to subsidize my living situation and be able to move to another property.

Or would it be looked at as a commercial property because it's essentially 5 units and one of them a commercial space, or is there possibly a creative way to make this work, Maybe by converting the space to be used by the tenants?

So essentially they are asking me to get the plans done before I can commit to purchasing the home.

They all essentially do the same functions and charge for the same 'side features' like background screenings, rental estimates, legal documents. 

There is so much demand in LA and a lot of big money, sometimes foreign, who I think are inflating prices and can afford to sit on a property they essentially over paid for.