Property type: commercialConsidering the 30 year mortgage interest rate has been reduced to about 4% now, is the above term still attractive in today’s market?

A house in that condition will also not attract a very high rent, so you'll have to consider your target cash flow.Yes, it's doable but you have to consider your plan.

I've been wanting to find the balance of improvements to retain residents & attract future quality interest.

But I specialize in the lease option model so I attract really quality tenants, however, if the screening is done well for the tenant, I would imagine that the tenant base would be good too.  

Being completely honest, this place was on the more expensive end of what I am looking for but I can't deny that it would be a great place to live and would hopefully attract some good renters, but rent would definitely have to be on the higher end which may make it harder to rent out.

We have a few clients who've done that, and you don't even have to have a kitchen down there to be attractive to visitors. 

The Fannie Homestyle loan looks like a pretty attractive option for this purpose.

And if that's the case, offering the 70/30 deal for a projected 18% LP IRR with a lower risk profile should be more attractive than the 30/70 deal with the same projected LP IRR.

Excited and happy for you and your friend.You are young so everything that comes your way may be appealing or attractive.

The attractiveness of ascending to this level is that the ground-up game unlocks a playing field that is largely less crowded, with (generally) higher return potentials, and the "newest product" advantage when it comes to leasing.