And even if so, I'd imagine there would be LOTS of restrictions and red tape as to what you'd be allowed to build and its appearance - No?

We've been looking primarily in the Red River Gorge (KY) area and also in the Hocking Hills (OH) area.

LA cash flow is certainly deep red. 

It will also not raise any red flags to the underwriters that you might end up doing a bunch of work to the subject property which can be seen as added risk for them. 3.

Quote from @Luke Carl: You get what you pay for here  Meaning too low cost would be a red flag?

That's a red flag for someone trying to use a business-purpose loan for owner occupancy, so many lenders won't allow it. 

Even though this would also be an equally small loan, banks can't turn those down if your credit is otherwise good because that is considered red-lining which is illegal for owner-occupied loans.

Any red flags or important clauses to include in our contract?

In bold, what's wrong with that?

But 25% is bold.