Parental co-signing is possible but not probable.Has anyone been in a similar position?

Otherwise I usually just track down the previous owners and get them to sign Quit Claim Deeds to me.

I think @Ryan Paltridge would agree that one of the best places to find a great lender that has experience in the owner-occupied residential 2-4 unit realm (and can actually close the deal) is through an agent who has experience in the same types of transactions. 

I agree with Andrew - don't have your new tenants sign a lease until you've had some time to experience them as tenants.

If it’s just a shell and you’re going to build it out, I can’t imagine getting a permit anywhere without engineer/architect signed and sealed drawings (blueprints) that detail electrical, plumbing, walls, load bearing calculations, etc.

But, I'd hire an agent experienced in the area who could properly advise you and handle the transaction.

Made an offer on a CA (Los Angeles County) commercial property and got verbal acceptance BUT the listing agent - who is also buyer's agent in this transaction, doublesiding it - is saying the Seller is now making a "Counteroffer" that Seller is a licensed real estate agent which must be signed.

One clarification though, you mention the need for them to sign your lease.

@Ian M. and @Robert Sims, there are probably restrictions on advertising signs.

A sign could help too.