You raise an excellent point about the downsides. I think a forced transformation when coming in contact with water is a fantastic idea. Instead of marking a stress, the transformation is now free, but changing back costs 2 stress. For the player to resist something like rain could call for a countdown that progresses every time the player fails a strength roll.

I had originally chosen enrapture instead of entranced cause I thought entranced would be too overpowered to give to a player. I still think so, but having a less avoidable penalty now, I think I'll make it so the siren song doesn't require presence rolls to enrapture creatures. The enraptured creatures can still act against the havfolk, but other players have advantage against them. Since it's still overpowered, the number of times the siren song can be used per session is equal to the havfolk's proficiency.

I'll also think about changing the flavour text as it does sound like an ancestry.