I don't think the market would bear a $200 increase in rent ( when lease goes month to month), but $100 increase is possible.The monthly net cashflow is now about $400 a month ( down from $600).

We also have friends that are in the STR market in Joshua Tree, Big Bear, Crestline, Lake Arrowhead and they all seem to be doing well.

I wonder if streamlining the cleaning cost into the ADR ("eliminating" another extra fee) encourages greater business (especially if positive reviews note place is clean, etc.) even if the market has shown it will bear the cleaning cost (and it's routine).Scenario 1: Guest pays $400 per night for 2 nights plus $300 cleaning fee.

So, I would make extra payment every month to that mortgage as the cash flow allows, bearing in mind the need to keep a prudent level of cash reserve for vacancies, repairs etc. 

I dont know why a relationship with a town or state inspector would have any bearing on a house sale . 

If you evict, you'll bear the costs of the eviction, plus the turnover/vacancy and on average have the same situation as it sounds like you have a typical tenant in terms of payment.

They charge what the market will bear .

@Sean Haberman, The S corp has no bearing on the 1031 exchange. 

The other factor is that money for how long they have been a tenant needs to be in an interest bearing account so you will have to account for that...

As mentioned above, some markets are visited by large groups on vacation while others are more "utilitarian" (business travel, insurance stays, special events, etc.).Competitive analysis will tell you what the market is currently bearing.