Building code may be an issue, if your area requires a fire wall between living units, that means a fire resistant wall (block) that raises above the top plate about 18 inches I believe under roof, that would be hard to put into an existing building from the foundation up.By the time you do a conversion I'd say your tenant would be paying the cost of the add ons, you'll be paying for the house.

If the house is nice and in that ballpark, you will have a relatively easy time hitting those numbers (if the value is there and you have "willing" buyers"), but as you push past it a rubber band is going to slow your pushing, you will feel resistance, since your buyer-pool drops off significantly when you cross that line in the sand from "49% DTI, no reserves" to "43% DTI, many reserves" - a lot of your "willing" buyers are not "able" buyers. 

They may resist at first but will praise you down the road when they realize how much money they are saving when they can say, "I can do that!"

I'm still patiently waiting for my copy in the mail;)If house hacking works for everyone including people with families, why do you think there is still so much resistance against it?