A decent contractor will be able to determine how tall the header and stud jacks he need for simply opening that up a little more, nothing that concerning.

I should add that I am currently living in Irvine, so I am able to go to the property and meet with whomever it may concern over the property. 

I have the money for a 20% down payment however that would leave me with nothing for repairs.

I don't think it would be an issue, however, my husband has concerns and will not feel comfortable moving forward until they are addressed. 

I leave out mortgage interest etc due to cash buyer.

So, if you are concerned about the law, Idaho Code §74-120, then I highly recommend checking to see whether there has ever been anyone prosecuted for violating that law (doubtful).

Well done on your journey to date - certainly so many people here on BP share your goal of passive income (or at least multiple streams of income) to minimize the risk of leaving their day job.

Also, it leaves the door open for you moving "up" to an owner occupied 2-unit down the road.

My experience with a PM company was terrible and I would never do it again unless my only concern was cash flow.

Also look at what assets your construction company owns. if you have very few assets and you have sufficient insurance then there is little to be concerned about in case of a suit against your company.