Error ‘No agent could be found with the following capabilities: msbuild, visualstudio, vstest’

I had this issue with Visual Studio 2017 installed on the build server (on-prem):

No agent could be found with the followin capabilities msbuild,visualstudio, vstest

When I upgraded a Test Controller the Build Agent lost some of its capabilities, such as VSTest:

I added these capabilities back as User Capabilities:

MSBuild_15.0 = C:\Program Files (x86)\Microsoft Visual Studio\2017\Enterprise\MSBuild\15.0\Bin\
MSBuild_15.0_x64 = C:\Program Files (x86)\Microsoft Visual Studio\2017\Enterprise\MSBuild\15.0\Bin\amd64\
VSTest = C:\Program Files (x86)\Microsoft Visual Studio\2017\Enterprise\Common7\IDE\CommonExtensions\Microsoft\TestWindow
VSTest_15.0 = C:\Program Files (x86)\Microsoft Visual Studio\2017\Enterprise\Common7\IDE\CommonExtensions\Microsoft\TestWindow

VisualStudio = C:\Program Files (x86)\Microsoft Visual Studio\2017\Enterprise\
VisualStudio_15.0 = C:\Program Files (x86)\Microsoft Visual Studio\2017\Enterprise\
VisualStudio_IDE = C:\Program Files (x86)\Microsoft Visual Studio\2017\Enterprise\Common7\IDE\
VisualStudio_IDE_15.0 = C:\Program Files (x86)\Microsoft Visual Studio\2017\Enterprise\Common7\IDE\

Then I got the infamous error:

MSBuild not found for version '15.0' and architecture 'x86'

I searched the web high and low, I did so many things to try and resolve this issue, I finally found this saying its been fixed in TFS update 2.

I upgraded TFS from update 1 to 2 and that did fix the problem.

You could double check if you are missing some capabilities such as VSTEST_15.0 for the build agent.

Settings- Agent Queues- Agent Pool - Agent- Capabilities

If the test related capabilities are missing, you could try to reregister the build agent. Or manually add the capabilitie by select +.