That comes out to 30% of their total closing cost.

For example, if you refinanced your home at 7% interest and took 30 years to pay it off, it would cost you a total of $121,000 to pay it off, and you would be paying a much higher interest on your entire home loan. 

Look at new construction triplex/duplex condo sales in the heights areas, subtract carrying cost over build timeline, materials, labor and construction costs, what their desired profit in heights deals would be and that would leave you with approximate acquisition cost of the lot. 

Obviously if you have unlimited cash then sure, don't do it but for 90% of people it is the cost of doing business. 

IN our price points 20 % of the build cost is way more than we are paying  but we are giving him 30 houses a year to build.. so there is that.

I’ve been there, and I want to share insights that can save you from costly errors.During property tours, ask smart and relevant questions.

But the no up front cost option is great for basic updates and upgrades for a retail home seller.

Whereas I don't know if it will make up for the cost of software when only renting. 

If you are looking at this decision through the investment lens, what would you net on the investment that you put this money in to, after transaction costs and taxes? 

If you were not, you’d save the same taxes as strategy 2  Or 2) You’re going to spend money (capex) that will be added to your cost basis giving you a higher yearly depreciation.