As far as I know @Jessica Aldakar, you will have to reside on site in order to STR the others.Several other members have had issues even when living in another unit.

In general I would appreciate any advice in this endeavor, and any other help regarding financing as a first time home buyer in an owner occupied space in NC would be great as well.

Welcome to the site @Jeremy Baker!

So look around, interview other STR owners so that you have sufficient information.

I proposed a couple owner financed terms to them and they returned with this one:Sale Price: $300,000 $25,000 Down. 3% interest. 5 year balloon. ($244K ish) This is obviously far better than any bank can give me with interests rates around 7.5% here non owner occupied.

I go to look at a property Thursday with a contractor to do my own due diligence, the property the owner wants 45k with an ARV OF 90k-120k.

Property that generates rent and that the owner has personal use of (your family member) can qualify as investment for a 1031 exchange easily enough. 

Hey Becca, Antoine here (owner of FlipSystem and MartelTurnkey).

Is the 1st - year owner occupied negative cash flow worth it.

If I were to rehab it, could I refinance with a conventional owner occupied mortgage at the ARV in order to pull out my original capital?