For the 20% down, it’d lower your mortgage and eliminate PMI, but buying now could help you start building equity and gaining appreciation.

Simultaneously, if this vacancy is a high percentage of the buildings total SF, I would market the property for sale to an owner-user who may be able to fill the vacancy at preferred rates while gaining investment income off the other tenants.

Sometimes you're better off just selling, taking your tax-free gains and going from there. 

When I die, they can keep renting out the properties or move into the SFH, or take the step up basis and sell it with not as high of a capital gains tax hit (I hope they wouldn't choose the 3rd option).

We have CDs maturing at the end of the year that could fund a new primary residence.Should we:1) Sell it with no Capital Gains tax.

I'm in this strange position of being out of state and unfortunatley not having the time to visit or gain personal expertise.

@Dennis Boettjer The best way I have found to find quality operators is by joining a Community focused specifically on passive investing in syndications.  

If you've enjoyed a lot of appreciation in the value of your primary home, you may want to start a timer to sell before losing the "lived in the house for 2 of the last 5 years" capital gains exemption (limited; not infinite, but big).  

If you're not exactly excited about jumping back into the market, there Are passive investments that are eligible for 1031 exchange as well.

They are going to be the cheaper alternative for SFR, so in theory you should get some decent appreciation gain and good tenant pool.3.