If that's the case I would not at all be assured of a court victory. 

Yes, the more units you go up, generally the less players in the game so there is some advantage in purchase competition as you go up, but also more management scale and cap ex for someone who is new.3.

Quote from @Melody Bohannon: Prior to my investment, I asked my advisor, Mark Zabilowicz,  multiple times about the holding period and was consistently assured that I could request the return after six months.

Agree, STR are saturated but given the numbers, I expect unsuccessful players will leave the market.  

You'd have to do the research locally, market by market, to determine who the players are.

They've also said that you'll need to show something to prove that you've had at least one 2+ day guest stay in the last 6 months (to be grandfathered in), and recently have assured that your permit will be transferable should you sell the home.

I would avoid that "guru" - a good property manager can make or break your investing career and I can definitely assure you that you're not finding a great PM using thumbtack!

The pref layer is a third party institutional player.  

Those are the players for residential...commercial the same way.

That seller will tell you anything to get you to buy that property but I can assure you there are better deals than this.