Interesting buy with tenant occupied

[Stephen Lynch]

Hello,

I'm considering buying a waterfront property as a primary residence and potentially make it a STR. It's in a up and coming neighborhood that is likely going to appreciate extremely well. This property is in good shape, on the water for 600k with a dock. A similar home down the street in an area already built up is around 1m. I'm not betting on the appreciation though ultimately it's a house we'd enjoy living in and potentially making it a STR that would cash-flow. I also see it as an inflation hedge given everything that is going on.

Here is the challenge... the house is tenant occupied until July of 2022 which means I cannot get a OO rate. I also can't get more than 2% CC assistance from the seller (investment loan maximum).

I could ask the seller to reduce the home price but it's not sufficient enough to make up the difference. I'm not sure if we could do a side letter and they pay me to pay for discount points to bring it to a OO rate? Any other creative ideas out there?

4.25% - $370k interest, 30 year term (investment loan)
or
3.25% - $272k interest, 30 year term (owner occupied)

Any thoughts?