Exploring alternative funding options is a wise approach given your situation.You mentioned your last resort could be borrowing from your 401k or Roth IRA.

They also help as mentioned with any city politics red tape.If anybody does reach out let them know you got their reference from me if you could, please and thank you!

I think this is simply the case of as you mentioned, seller not needing to sell but will if someone pays high enough today.  

There is no reason to mention "legal or illegal" occupants because vacant is vacant. 2.

Eric maybe right, you may need to wait a little while longer before you will be able to refi. 

OP will need to buy out a tenant or wait the year to when the leases expire if they want to move into a unit. 

It is true that you may miss out on this home, if sold this week, but also consider the Joy Of Missing Out (JOMO) by not overpaying for this property and also footing the bill for many of the potential repairs required for a 120+ year old home as mentioned above by the previous commentors.I would encourage you to take a contractor with you to the open house or someone with experience in this age of home to give you some insight into the property and what may need to be addressed in the first few years of ownership. 

Like Dwayne mentioned, a FAR/BAR vacant land contract will likely be sufficient. 

But if you wait an entire year to find the "best deal," you're behind the guy with two good properties.Good luck! 

I was waiting until I have a more thorough analysis, but I've been busy this weekend/week with moving.