There's probably no "do this" and it works for everyone so keep gathering different opinions.The way I view a "good deal" might be different than how you view a "good deal"...so let's look at it from an "average" person's perspective.  

For property tax reasons, these lots were tax assessed at no less than $5,000.To put this in perspective in today’s dollars (this was 40+ years ago) he would have paid maybe $500 for a tract of land tax value of $35,000.  

Looking at the city from an investor's perspective, @Becca F. is absolutely right, you need to make sure you're buying in the right neighborhood.

Account Closedi am happy to share some perspective.  

Your wife's perspective is no inaccurate, it seems you are both looking at things from different ends of the spectrum which is great!

Alec,From an Insurance perspective, ask the current owner to get from their agent "Loss Runs" for the past 5 years.  

Personally, I would give them notice of termination and start fresh with a new renter that I've personally selected, using my lease, at my rent rate.

I do understand everyone's perspective.

I always issue the notice to pay or quit (called various things, thats what it is here) the first day that rent is late, just to start the process in case they don't pay, so you can get them out as quickly as possible and start fresh.

For perspective, the house directly next to this house is estimated at over $900k fully updated with slightly higher square footage, but 1 less bedroom.