If you had no knowledge and they broke the lease I'd issue a notice of non renewal, but give them the option to remove the cats.

Those are separate issues that complicate the sale, but do not deprive you of the right to sell.

My neighbor has listed his but also has had occupancy issues as an STR and said that most people looking for either rooms or cheap stays but I can't comment on that as I have no experience listing as an MTR.

Even if you don’t have enough equity to buy in all cash, you may still have enough to make a larger down payment, which has its own benefits too.Bottom LineHomeowners have an incredible amount of equity today – and that’s why the share of all-cash buyers is on the rise.

Now I can see some builders having an issue with comps.. but other than that its crazy to take these funds as income and then pay tax and plow it right back in.. 

There's a good chance the issue(s) you face has already been discussed and answered.Ask questions in the appropriate forum.

I have had no issues with using their rent collection services. 

Do you know if this would be an issue when it comes time to having my 5 year DCA inspection in ( mid 2025) as the property is only register with them as a 4 family?

OK I do have a little expertise in CA on these issues..

We currently use Hospitable for 12 properties, and it's working fine, no major issues, and I know they've been expanding with new features.