Do not treat them any softer or harder because they're you're neighbor.

Does anyone have any experience (good or bad)?

I think in a bad neighborhood as well.  

Inspectors always make things sound really bad, that's their stock in trade.

There are seven tests, however the most relevant tests for STR investors include:Perform substantially all the work related to the activity.Participate over 500 hours during the tax year.Participate over 100 hours during the tax year and no one else participated more.If your property meets one of the exceptions above AND you meet one of the above tests, you can qualify to treat your rental activity as non-passive.

I met with the contractor Sanborn Construction Group but being out of state wanted to see if anyone had worked with them in the past and could give a refferal good or bad. 

Since you’re considering Tahoe, where you might use the place as a short-term rental when you’re not there, it’s also good to outline how you’ll handle personal use versus renting it out.I’ve seen folks succeed with this by treating it like a business, even if you're all friends.

The “STR loophole” allows them to treat rental income as non-passive if they meet material participation and other requirements.Can an STR unlock PALs from LTRs?

Seams aren't perfect but are not bad now, looks like it will end up being a regular maintenance task but at least I don't have to pull up the baseboards anymore!

I guess he wasn’t a bad soul because nothing bad ever happened but we could definitely feel his presence!