The high HOA fee is already a factor, so ensure you’re comfortable with the overall carrying costs.Focus on the Land Value: Since the lot has development potential, you’re looking at this as a long-term investment.

Will you use the HELOC as a short-term bridge, or plan to hold it longer?

Since you’re considering converting the upper unit into a short-term rental, you may also want to implement strict rules around smoking or strong odors in your house rules to avoid future issues.

call a few brokers and just see what their terms are.

I am interested in learning all I can about Long Term and Short Term Rentals. 

Such a horrible loss.Regarding your property, I think as the trends in the report continue over the short term you will be able to sell closer to full value in coming months.

Sometimes the long term capital gains are palatable and it may make sense for you to pay the tax rather than force a bad deal.

My ultimate goal would be to buy fixer-uppers to turn into long-term rentals.

In my mind sub to is for short term .. long term rentals is very problematic for many reasons. 

Something more passive via a syndication could work for them, and otherwise they'd probably prefer something simple like a long term single family rental.