A patch kit or asphalt over it all is very common.

After the lower was done we began a full rehab on the upstairs, keeping the home zoned two family, separating utilities, and gutting to the studs.

@James Evans this is a common issue with 1-4  unit properties.

In addition, these new furnaces are direct vented (they do not take combustion air from the conditioned space) and the natural gas ones do not require a chimney (which means that big source of heat loss can be stoppered or removed).If you are paying utilities, a new furnace will pay for itself.  

We got a lot of feedback from potential tenants in that market who were looking to stay under $1000/month including most of their main utility expenses. 

Couldn't I list it myself somehow, paying a small fee, or even simply sale as a FSBO, utilizing a 2000 marketing budget or what not?

It's a common misconception that 5+ units is needed for commercial financing.Commercial/portfolio loans can be used on SFH's and 2-4 unit MFR's as well.

I'd bump that up to 10%  or 12% to be conservative.You'll also have to factor in utilities, since there is no way to know who is using what.Let me know if you have other questions. 

You are responsible for maintaing the clearance around your utility lines. 

Property taxes, insurance, utilities, HOA fees and loan/financing costs are some of the ones I've recently learned about.