Buyer's remorse?

I live in a college town, so there are a lot of formerly nice, older houses in the downtown that have been being rented and beat to crap for years. Many these houses are 19th century buildings, or early 20th century, that were built far better than we are building now - the materials were better, the proportions of the rooms more gracious. There are also some large, multi-unit buildings, some that can hold up to 40 or 50 tenants, that rent now as sort of de-facto private dorms.

In the last few years, there has been a downtown high-rise apartment building boom, and the students are now preferring to live in these newer apartment buildings - they may be built equivalent to your average Hampton Inn, but they are new and clean, and they have DSL and cable TV and air conditioning, and their parents are happier about paying for them to live in these new places.

Now that I am on my way to buying a house that will be at the most 2 units, I am wishing I could buy one of the bigger old buildings, and run it like a private dorm with a food service for 40. The problem for me is the economics - I can afford the house I am buying, that is costing around $200K and I will be scraping to come up with $$ for remodeling. The big old joints start at around $400K, and will take beaucoup bucks to fix up; the sellers are guesstimating at least 25% over the purchase price - I guess there's no reason to feel remorse, just recognize that I just don't have a million bucks to invest right now.