Fannie is pretty crystal clear about this distinction. 

It WOULD have worked for your BRRRR goal if you already had 20%+ equity in the property before requesting the extra $60k (either by putting 20%+ down as a deposit, or/and buying it at a 20%+ genuine discount to begin with).The subject of "cash flow" (as distinct from "cash out") is a separate issue, which hasn't yet been discussed here.

Make a clear distinction between your two roles.... landlord and neighbor.

Its important to make some distinctions here. 

However, the two properties are currently two separate and distinct properties making them each a 1-4 unit subject to comparable sales valuation.  

I think the main distinction is Short Term Rental vs.

., thanks for pointing out that distinction between actual returns and number of units.

I designed the kitchen surrounding the semi-open feel but still clear distinction from living room.

Bad tenants are bad people, there is a very distinct difference.

I did not see any distinction between adults or children when someone is considered as an occupant (other than 12 months or younger) they don't count, or at least here in MA.