I advise to be very careful of who you have work on this project.

The tenants have not taken great care of the space, would this cause a lower reasonable rent? 

Does the landlord take care of them, or do you as the tenant take care of them?

Be careful, STR are banned in the city of Temecula and fines for violators are $1000/day and can be retroactively enforced. https://temeculaca.gov/1241/Sh...

One thing to be careful with is the last 3 years have been atypical for the Calgary market, it's been a good run, but don't expect these kinds of returns long term.

Even if you could, I don't think a bank would care. 

I am a handyman with a lot of experience in residential and commercial maintenance, so I would like to be close to my first investments so I could take care of the management and repairs myself.

According to HUD guidelines, they should provide you a letter from a healthcare professional, licensed in your state, indicating the need for an ESA, and mentioning an ongoing relationship.  

NO, your realtor is not part of your team, all they care about is making the sale.

Avoid personal use of the property, as it can limit deductions, and be careful to correctly classify repairs versus capital improvements, as improvements must be depreciated.