Ahhhh, I think it will be OK living across from your parents. Especially if it is just you and the kids! Sounds like it will be a good place even if it needs some work. Don't look a gift horse in the mouth.
You are handy enough to fix it up. You may even be able to build some sweat equity! Do what you gotta do. This sounds like a good opportunity to get your life moving on. Take advantage of it.