If people are getting free electricity and water, they tend to be a little less frugal :) .Then check on insurance costs for a MFH and add that to your projections.Finally, talk to your contractors and see what requires permits, what their experience has been in getting them to pass inspections, the timeline and the cost.Factor all of these into the decision to move forward or leave as is - maybe advertise it as a 4/1 with a home office with outside access and get more rent that way.One last point - I hope that the addition you mentioned was done with permits and is reflected on the tax rolls because if not, you may open a can of worms you wish you had not.

As a listing agent, I let my seller know it can trigger the due on sale clause and they lose control of the home but still responsible for the mortgage if buyer doesn’t pay, so most aren’t interested unless it’s a special situation where they really need out and no real buyers out there.

I am also aware of doing a 1031 at some point.My biggest question is taxes if I were to sell.

Now there are some sellers that have great income and credit they just need to get out of town as in yesterday and Sub2 might work if the Sub2 buyer is credible and will not mess over the sellers credit… As in the Investor needs to make the payments on the underlined note regardless of whether their renter pays them or not.Back to your original question.

Also, the opportunity cost of leaving the property vacant for a year while paying a mortgage on it and not receiving rental income is much higher than what the marginal difference in rate will cost you until you cashout refi it.

Hey FarhanIncentives available in New Jersey: SREC-IIs (Solar Renewable Energy Certificates) and the federal Investment Tax Credit (ITC). 

Beside the “subject to” that’s recently become the subject of much debate we utilized  ”no interest short term owner financing”, the “2nd mortgage crank”, substitution of collateral, mortgage subordination, wrap loans, real estate “exchange” (not for tax reasons), sale - lease back, guaranteed rent payments, sale - buy back, land offered in lieu of down payment, zero coupon bonds as substitution of collateral, and a few others that escape my memory.  

It may sound nice to pay a 6% management fee but the extra fees can add up to be more than the other company that charges 10% with no additional fees.

I like that the HELOC functioned more as a credit card, and I only had to pay for what I used, so I had 200K of equity on hand, but only had to pay the interest on 120K.

Quote from @Lucas Hunt:  I will essentially be managing the entire property/collecting rent and my friend will not have to lift a finger.No offense,  but your friend would be better off buying the property for himself and paying a PM 10%.