Are you concerned about the investment's ability to weather a recession?

Also, given that we are ten years into an expansion and probably due for a recession I'm concerned lower occupancy will cause me to lose money.   

Not sure about your market, but in mine, 550-700 is in the average home range and luxury starts above that.Generally speaking, and especially in the current/coming recession, you'll want something that's at least in the average price range for your area and has the amenities that will do great for STR. 

Would you rather have bought US property in 2009 in the midst of the Great Recession or right now?

(I see some young syndicators who have never been through the Great Recession acquire thousands of units in a hurry and I fear they're growing too fast, too soon and they will burn a lot of investors when the market correction comes).Slow and steady investing done right, becomes quick and BIG over time.

But if I'm buying in stable, cash flowing markets with a fixed-rate mortgage, I don't really need to worry about a potential dip in values because my monthly PITI isn't going to change, rents usually don't dip much in a recession, and especially in relatively stable markets such as the mid-west.As far as investing for equity is concerned, I think you should always be looking to create equity whether it's by buying below market, or adding value through a rehab or by other means.

I've researched the market and use that research to make an investment.If you believe that cash flow has no risk, you need to evaluate what happened to rents/vacancies in Detroit, las Vegas, and many Arizona cities in the Great Recession (R). 

We are doing a 2 year lease for my exit strategy, and with inflation and possible looming recession I want to include a rental increase for the 2nd year.

When Wall Street professionals start debate when the recession will arrive, listen attentively and have contingency plans put it place.

In my opinion that is the reason the they lacked the turnaround from the Great Recession.