Lately, the 50K, 60-65K three-units I've come across are in higher tax areas (around $3800 annually) AND they need substantial rehab, like a total roof replacement.

Sorry, if some of the answers seem redundant.WHAT YOU REALLY WANT TO KNOW IS AVERAGE NIGHTS OCCUPIED OVER THE YEAR, AVERAGE RATE, AND EXPENSES (CLEANING, PROP MGMT, REPLACING LINENS, NORMAL MAINT, ETC..)Do NOT use 10% vacancy as a worst-case scenario for vacation rental after figuring out which months can be rented. 90% is a very high occupancy rate, even if you're just talking about a 1 or 2 day gap between rentals due to timing of coming-going..

Only place carpet in the bedrooms, this way if you have to replace one room then you can have your Handy man do one room, and nothing needs to be seemed.  

Or would it be better as a tear down and replaced with a duplex or tri (if rezoning is at all possible)?

Some bases are "replaceable" and others are not as much so.

If there's lots of equity, meaning 50% LTV or thereabouts, as new owner, you could probably find a loan or investor to pay off the existing loan and replace with what ever the market supports.

Aside from that, technology has replaced manpower in many industries, meaning less jobs (though prices don't fall in unison)  Tear down the houses in depressed areas, and let the market drive growth, not government programs that create a false market.

What I see out in the mid west is that land has no value because you can buy existing houses all over the place for less than replacement value... but I don't know this area of course and maybe there is a market for new builds.

Flooring sourceGranite sourceWindow source (can beat Depot prices on larger projects)Screen repair and custom replacement screensRoofer (thanks Anson!)

Sometimes you need to bite the bullet and have a professional fix things, and replace them if necessary.