If maintenance issues arise, take care of them promptly.

NOW, having said that, I've been told there are steps you can take to combat the issue that arises from the "gift" stipulation...First, the "gift" (loan) coming from a family member raises far less red flags than does a gift coming from a friend. 

However, I am open to good opportunities should they arise in other markets as well.Thanks!!

That can’t be undone and is emotional for many people as they age.Also from a financial standpoint this property will not cash flow so you will lose money if problems arise with the property such as needing a new roof, plumbing problems, etc.

Luckily I’ve gotten 5 stars from all my guests (cross my fingers) even from the ones where unexpected issues arise.

While you may not be that kind of LL, he is probably very worried and the request for deposit most likely insulted him  While that is not your “issue”, it does help IMO, to understand motivation of other parties when conflict arises. 

Actually I heard of a way that You CAN use it to fund the purchase outright then with money from the HML still left you would make his/hers payments with that money along with any expenses that arise, (None out of your own pocket) for the Flip period and once rented out for the first 30 days (if that) You could take it to a bank to refi and pay off the HML so you can get that lower interest over the HOLD period...

One of the Commercial Real Estate Schools here in Atlanta recently posted this list of Top Commercial Markets for 2019 – here are the top 3: Miami, Florida - With a significant tax advantage in the city and a competitive price per square foot, Miami has continued to see a rise in the commercial market — to the tune of over 8% in year over year increases.

That could be a big problem if a claim ever arises. 

Vallejo, Richmond, Stockton, San Leandro, Hayward... all areas local to me that are like that, with 4plex loan limits well north of $1m & still 5% down with PMI that drops off once you have the equity (unlike FHA where it's "life of loan" and you'd have to refinance in a rising rate environment to drop the mortgage insurance).