I assume the appraisal is only based on the "official" home.I would be at least moderately concerned that you have space being leased out for habitation purposes that is not on the city and tax assesssor's radar.

Would I sign the lease and the option with the seller and have her assign or draw up a new lease with the tenant?

I leased it and managed t myself.

I try to have at least 1 year leases initially on each house to reduce needing to rerent, and the touch up you need to do inbetween renters.

Or maybe you get master lease that permits sub-leasing along with an option to purchase in the future.

I give myself the option in the lease, but do not typically.

I would do the fix-up while living there and move from unit to unit getting the place looking fresh as leases ended/tenants moved out.

Bird Dog (find good deals for investors- if this is legal in your area)Sign leases for a landlord.

I bought it in November the tenant's lease is up at the end of July, 2013.

If you see the market start to reverse and move back down, you will be stuck with tenants in a lease.