The key factor is ensuring the property qualifies for favorable tax treatment by adhering to IRS rules regarding short-term rentals and material participation.For the 7-day rule, the IRS requires that:The average guest stay must be seven days or less for the property to qualify as a short-term rental.If the average stay is 30 days or less, you must provide substantial services similar to what hotels offer, such as daily cleaning or concierge services.Regarding material participation, to further classify the income as non-passive, you must meet one of the following criteria:You spend more than 500 hours actively managing the rental in a year.You manage the business yourself and spend at least 100 hours, with your involvement exceeding that of any other person involved in the rental.Please note there are actually 7 ways to qualify, the above two are the most common.

How flexible is your lender when it comes to LTV, and have you ever considered how private money lenders can offer more competitive terms?

Very simply, multifamily spreads out your risk if a tenant moves out generates more income with more units and disproportionate amount of increase in expenses as there are more tenants to deal with.

Happy to provide feedback if helpful. 

A house that has been fully rewired is much more valuable than one that is from 1955 and has not been updated.

Don't make your life more complicated than it has to be.

In others experience is this return worth the risk given Multi-family environment ie supply, interest rates, project specific risks, illiquidity risk, and more specifically the Preferred Equity subordinated tranche risk (this sounds like just a Mezzanine loan without recourse).

Water submetering is more difficult with smaller properties; especially older ones. 

(It also helps if the banker knows you, knows what your business does, and you have positive bank account history.)Hope this helps!

If you're interested in joining the tour and learning more about potential investment opportunities in Tulum, feel free to reach out.