Obviously you need to conduct a feasibility study to determine if demand outweighs supply. 

You might find the kind it currently is has oversaturation for your local market but one that caters to the other categories is in short supply and high demand.Once you decide on hotel type you want to operate at ( make sure it will comply with the flag agreement or you might want to switch flags or going independent) then go research the other properties.

We didn’t have a large supply of ready tenants from which to choose who *did* have jobs, for quite some time as the city is rather small.  

If so, you definitely do not want to supply them with those, there are laws that prohibit that.

Replace all outlets & switchesInstall vapor barrier in crawl Space The cost of the job is as follows;-New 2 ton compressor/new coil & supplies $1100- Central air install $600- Sub panel supplies & install $500- All supplies & utilities $15,000- Labor $6,000- Appraisal $500- inspection $400- Lawyer $500- Lawyer fee for zoning correction pendingWhen we began the rehab we noticed the previous owner created a doorway between the apartments and originally the was a brick wall between the two units.

How much real estate supply does the area have? 

There will always be renters, it is the exact supply that is in question.If a city/neighborhood is up and coming, then your supply of renters will increase rather nicely. 

And the coolest thing is that Amazon Key is a new service where Amazon will deliver supplies inside your house or garage so you don't have to pay anyone to pick up supplies for you. 

That being said I actually ran your numbers through a proforma I use and here is the break down for that: Purchase price: 129,900Effective Gross Income: 22,086 (vacancy 10% of gross income; 2454)Expenses:Expenses%EGITaxes $ 4,618.00 20.9%Insurance $ 1,500.00 Heat $ - Electricity $ - Water / Sewer $ 1,200.00 Trash / Recycling $ 180.00 Lawn / Snow $ - Management $ 2,208.60 10%Repairs $ 1,104.30 5%Capital Expenditures $ 1,104.30 5%Supplies $ - Accounting / Legal $ - Miscellaneous $ - Total Expenses $ 11,915.20 54%NOI: 10,170.80Financing: Down Payment $ 32,475.00 25%Bank Loan Amount $ 97,425.00 75%Interest Rate5.50%Closing Cost $ 7,794.00 6%Loan Term (years)30Monthly Payment w/ ESCROWDebt Service / yr $ (6,638.02)Debt Service / mo $ (553.17) $ (1,063.00)As is your property you're looking to purchase is valued at 7.8% cap rate and will produce cash flow of $3500/ year.

At various times throughout the summer, the tenants and their parents have made trips to the property to drop off furniture, clothes, etc. and each time have called to voice their displeasure in the state of the property e.g. the bathroom is completely unusable (even though I have stated numerous times the renovations that I would be making and the date that it would be ready by).