If I leave this amount in Sch-E, I get taxed at ordinary income tax rate at Federal and State level, which along with my regular W2 income can be substantial.

This discrepancy has left me confused—should I be concerned about this?

Obviously the HOA is keeping values in this neighborhood down because an owner would have a mortgage plus another $715/mo for the HOA, which only covers use to a community center but nothing else.Besides holding costs, is there anything else I should be concerned with for a flip on a land lease? 

Hmm, what didn't you leave out?

This is a touchy subject.If you observed specific concerning behaviors during interactions, such as rudeness, aggression, or disrespect for property, these could potentially be valid reasons for rejection if documented properly.You should add one very important things to do on your checklist, past landlord references and it must be legit and find out why they aren't there any longer.

The first hurdle was convincing them to leave via cash for keys.

That is honestly my biggest concern. 

I also advertise before someone moves out to get a new tenant before the current one leaves. 100% occupancy on a LTR is very common for me.No idea on a MTR.

Since the house is for sale, the most important concern is marketability.

We could possibly live with her staying there until April but I do not believe that she will even leave then.