The issue I see most is the cashflow gets crushed by HOA fees and the added headaches of having them tweaking rules etc. 

On top of that, FHA has very strict and particular rules around income.

The 1% rule is an old metric.

.- The golden rule in my group is the seller has to have a deal, the numbers work, be willing to sign, be willing to move out no later then 7 calendar days prior to the auction!!!!! 

I would check the rules in all of your jurisdictions.

However, if you sell instead of rebuilding, the IRS may include part of the payout in your taxable gain unless reinvested under the §1033 involuntary conversion rules, which allow you to defer taxes by purchasing a similar property within two years.If the property was your primary residence, you may exclude up to $250K (single) or $500K (married) of gains if you lived there for at least 2 of the last 5 years, likely resulting in no taxes owed.

Make sure you know the rules in the state where the property is located.

Ok, but I mean is it against the rules?

As with all regions, the Oregon Coasts' counties and cities are tightening their rules (and quantities of allowable vacation rentals) and there are a few adjustments to last year's regulatory landscape.

Whichever strategy you choose, ensure you're adhering to IRS rules about prohibited transactions and working with experienced professionals to structure deals properly.Regarding non-recourse hard money lenders in San Antonio, I don’t have specific recommendations.