After listening to him talk for close to 45 minutes, I finally said that if I have an extra $18,000 to $35,000 wouldn't I just invest that in my own property and get all of the rental income and if I sold the property 100% of the proceeds, not 50% of it. 

When I finally got feedback from the appraiser, it turns out they walked the property and decided it's not a fourplex, rather the "highest and best use" is a duplex and two townhouses.

So, if you plan it well you can deffer those taxes and then stiff the tax man by dying before you finally cash-out and sell those properties. 

When the day to sign the lease finally arrived, she called me and said she had to back out.

It is typically your primary job.The 40 hr/week W-2 worker is going to have a hard time convincing an IRS agent they are meeting this threshold.STR loophole is a better path for my friends in this category.Once you finally cross the pro hurdle, you're not done!

Before making your final decision, I'd suggest running the numbers both ways - calculate your tax liability versus the potential long-term impact of accepting those unfavorable terms you mentioned.

As the host, you have the final say on who moves into the house.

Finally after about a month, the Vendee lender let me know he got a message that another offer was accepted.  

Right now I rent on a room to room basis at my properties and because of the high turnover I was thinking of implementing a very thorough system I thought of with almost no face to face interaction until the very final signing. 

Finally, confirm if there are any existing service contracts (for landscaping, pest control, etc.) that may need to be transferred or canceled.