Those loans are meant for owner occupied primary residences. 

I'm financing it as a second home (since I'll occupy some of the time and rent out when I'm not there), through a conventional mortgage.

Owner occupied only.

As an owner occupied home, you can sell and take the profit tax free. 

It currently has 14 out of 17 units occupied, generating a monthly income of $6,300.

The longer you drag this out to save a few more bucks the longer it will be before you can have this occupied and earning you money 

this property is well maintained 50 unit around ten years old preforms well and has assumable low rate freddie debt asking price is 11.7 mil assumable debt is 6.5 mil at less then 3.5 % 

FHA requires the borrower/buyer to be owner occupying the building, but state law requires that all lease transfer to the new owner and cannot be terminated solely due to ownership change. 

Note owners do not have vacancy, tenant turn over, typically take better care of the unit than tenants so have reduced maintenance/cap ex compared to a LL, and in many markets owners have reduced property tax compared to non owner occupied.  

If you rent the condo out to others it would be the same thing -- you would need a policy that only covers the interior walls -- it would be an HO6 tenant occupied and depending on the carrier you currently have you would either change the occupancy status or you would need a different policy-- in my experience 9/10 times they require a different policy. 2.State farm does not really ask a lot of questions -- their quoting process is not as in depth as it should be.