Chauncey,The Increase in your Homeowners or Dwelling Fire Coverage is likely due to an increase in the Replacement (rebuilding) Cost that the Insurance company requires. 

In terms of replacement cost, you will need to consider the cost to re-build (vs. market value).

We took the kitchen and bath down to bare studs and are rebuilding. 

For a 4 unit, they'll be based on the value of the property, and it should be roughly 1k/year per 100k of value (cost to rebuild the house if it burns to the ground, not including the cost of the lot).

For once-in-a-while light handiwork (tile, sheetrock,rebuilding a small deck etc) there's no point in owning something with all that capability.  

I do a lot of BRRRR’s and just make sure to update all major mechanicals and fix structural issues before throwing a tenant in there.We are flipping a house that’s probably 100 years old and practically rebuilding the whole thing.

This success is causing me to consider purchasing another rental property once I can rebuild greater cash reserves (the "honey do" list for the new house is expensive, lol).

How much does it typically cost to knock down a property and rebuild in Los Angeles or Orange County?

It took around $25k more to fix and rents for $700, but much had to be redone including digging up the old sewer, new plumbing, new electrical box, flooring, all new windows, new gutters, new furnace and water heater, and a complete rebuild of bathroom and kitchen--much of the work, including plumbing, I did myself or hired very cheap local labor.

I have the cash to purchase the property with out financing but , would not have the money to rebuild.