If you reduce to $2,300 and are able to fill the property faster, yes, you are "losing" $100 per month, but even at that rate, it would take two whole years to equal the loss of the $2,400 vacancy month.

Is that why you’re leaning toward renting, even with a $1K/month loss?

Then I find out a week ago they sold the property at a loss, ALL my capital is gone, and Ken McElroy goes on his merry way making youtube videos about how much money he is making. 

They learn from every loss, improve their process, and move on to the next opportunity.

Granted there is a cost in hiring an agent, Having someone analyze each deal with localized knowledge is worth its weight in gold.

You might consider: Consulting a Real Estate Attorney – Your emails may possibly prove misrepresentation.Requesting Public Records – A FOIA request might reveal why the city denied you but later approved the duplex.Escalating to City Officials – Bringing this to local officials could expose inconsistencies.Exploring Tax Write-Offs – A CPA might help offset your financial loss, if it is possible.I’d definitely seek legal advice.

My basic underwriting making some standard assumptions on HOA expenses, 20% down, 7% interest rate, 30 year mortgage, utilities, supplies, and maintenance costs shows a loss of about $22k per year if you are self managing.

When I attempted to do a similar flip in another county in Texas, where I was unfamiliar with the nuances of the area, my “slam dunk” deal ended up as a $40k loss!. 

REPS does not relate to STR's.For short-term rentals (STRs) with an average rental period of seven days or less, you don’t need REP status to offset losses against other income.

Since rental losses are typically passive, the best way to offset W-2 income is through Real Estate Professional Status (REPS) (750+ hours) or Short-Term Rentals (STRs) (100+ hours and more time than anyone else managing the property), which allow real estate losses, including depreciation, to offset active income.A cost segregation study accelerates depreciation, generating large upfront deductions.