If it's a good area, meaning high cash flow, it attracts both landlords and tenants, and the quantity of tenants willing to pay high enough rents to deliver the higher CF, is what makes it a good area to invest.

That will affect your current ability to attract quality renters or receive strong reviews following their stay if made into a STR. 

With a property of that size, you should be able to attract larger families and demand higher rates.

I would be careful before buying a property right off the bat, especially with a limited use program, that is going to produce a negative performance on day one and only if all of the numbers are spot on.Be patient and keep asking questions.  

We did mostly durable, high end finishes so that we could attract high quality tenants, and charge above market rents.

Then improved the vacant unit to attract a Househacker and put it on the market.

LOL @Jay Hinrichs "sounds like the clothing optional places" was exactly what I was thinking.No kids/pets isn't my cup of tea personally (I could field my own soccer team and my bird dog is my BFF, LOL), but I can totally see the attraction.

And do you think its worth it to purchase a LTR that produces a low ROI with the low rents for the potential of raising them to fair market rents to make the investment worth it.

I'm wondering if there's a way I can leverage the land to produce income?

You will only want to buy properties that attract the tenant pool you want.