I have a couple of investments and am about to jump into a Short term rental while still being a w-2 employee.

Gross Margin is an important calculation for developers/builders.Gross Margin = Gross Profit / RevenueWe shoot for a 20% gross margin on our New Construction HomesReal #’s:Home Sales Price: $374KClosing Cost: $18,700Cost of Construction: $258KLand Cost: $30KGross Profit = $67K$67K/$374K = 17.9% Gross MarginCame slightly short of our goal of 20%Homes Values and Build Costs are constantly fluctuatingI wish we had a crystal ball

Quote from @Ben Russell: Although I agree the leases and the legal implications of "Mid-Term" rentals and "long-term" rentals are closly related, I don't think the leases should be identical. 

I wanted to get feedback on managing short term rentals in Hawaii. 

Most of the bad noise right now is about downtown skyscrapers and REIT or Syndication apartment complexes where they played short term versus long term interest rates wrong.  

But neither do you, yet you started with:"Short answer is "yes"  - which I consider misleading.And you manipulated the OP's question to fit your agenda.

When the housing market became seller friendly, I unloaded 5/6 of our long term rental units, paid off our house with that and invested in stocks and mutual funds…completely no fun, right??

Our first accepted offer was a 320 unit deal that we contracted, put up non-refundable (yeah, I know) earnest money, and thought we had our financing and money in place to do the deal.  2 weeks before closing a major (several million) partner pulled out leaving us short of the funds needed to close. 

It’s a city I know well because I built a 12-door portfolio there between 2019 and 2021.Detroit offers a lot of value in terms of affordability and rental demand.

These loans are short-term as you mentioned, typically 12 months, so you'll need to refinance before that balloon comes due.