Take your hit and learn from it. 

Some cliff notes:REP status requires 750 hours in real estate activities, and then after you hit that, the test is materially participating in your rental activities.If it is a short term rental with less than a 7 day rental period, if you materially participate, which could include at least 100 hours and that is more than anyone else, then yes possibly can use the bonus depreciation against other sources of non-passive income. 

I think since it's 'new construction' I assume it's way more complicated, and I'm sure it comes with different challenges and factors to consider, but as long as you buy it right, have supporting new construction comps, and are confident with your cost per sf analysis, you can hit your target margin - or close to at least! 

When they decided to sell this parcel, that is when we hit a tiny snag.

I'll hit two things real quick and hopefully they help.

And “base hits” are ok.

Every time that happened we increased our savings by 75% of the difference and our spending by 25% until our spending hit a level that we were comfortable with. 

Now I'm helping my out-of-state clients do the same - purchase flip, BRRRR, and buy and hold deals for cash flow, hit the 1% rule, have tons of appreciation.

Loan to value ratio: The higher the loan to value ratio (LTV) is, pricing takes a hit.

Market forces will generally hit real estate similarly.