At CA tax rates it doesn't take much to be a significant number!  

I offered them 10% down, interest rates favorable to me, amortized for 30 years, but with a balloon payment after 3-5 years.

my experience has been (1) I can obtain the same rental rate for a 6 month lease that I can for a 60 day “stay” if FULLY furnished (2) some of these 6 month rental turn into 2 years or more.  

You would end up saving the higher interest rate on the HELOC as well as closing costs.

Interest Rate: 6.5% per annum (fixed)5.

This could cost around $500 to $1,500 per unit, depending on the size and complexity of the project.Certifications: There may be additional costs for certifications (such as HERS ratings) or third-party testing to verify the energy efficiency of each unit.For a 90-unit project, you could be looking at costs in the range of:$45,000 to $135,000 for energy modeling and certification (depending on the cost per unit).For a 112-unit project, the costs would likely be:$56,000 to $168,000 for similar services.Tax Credit Calculation:If you meet the energy standards, you can claim up to $2,000 per unit.

Hoping at some point the interest rates drop!!!!

But higher tax rate in PG county. 

There is no point refinancing the almost paid off property to buy another-just get a mortgage on the new property.hard money lenders are going to charge you a higher interest rate.

Quote from @John Warren: @Mordechai Chaimovitz cap rates and NOI are commercial real estate terms, and 1-4 units are not really valued in the same way.