They likely have given you allowances for things like tile, flooring, etc.It doesn't matter what homes are listed for, it matters what similar homes have sold for.

The plan is to find a duplex with at least 3br/1bth on one floor and 1br/1bth on the other.

Pulling out the carpet, kiltz the floor and than painting the house will get rid the traces for a "normal" person.

Tenant A  is  coming from a SF home rental loved the 1st floor apartment but keeps complaining tenant B on the second floor is walking in the morning too loudly and shutting the door loud. 

Its in really good shape according to her and the landlord has made upgrades on the floors and deck for the property.

From what I can see in the pictures, it needs some landscaping work to create some curbside appeal (some bushes and dead grass areas fixed), the basement needs to be finished (completely dry-walled, needs paint/flooring/trim), upstairs needs paint/carpet (mostly good condition, just old/dirty/strange colors).

., 2 floors plus a basement.  

On the main mid-level I demolished all existing walls, installed a new beam above the single load bearing wall and have extended the original oak hardwoods into the kitchen which had been vinyl!  

What I plan on doing is to knock down the ranch to the foundation and build back up with the same foundation size but add a 2nd floor and make a visibly attractive craftsman home.

The paint and floors and cabinets and everything are in good enough shape that I won't do anything besides clean them.