You got a young man that can breathe underwater who got it from his mother who is an alien stranded on earth and an orphaned mermaid that the man tries to protect. Add to that there's some alien tech like a clocking device to hide their underwater home or a full body aqua suit the size of a wrist band when not activated that was salvaged from the mother's vessel in the past. All this happening in the present, underwater, near the Brazilian coastline and the Bahamas.
Depends on how you write it. But I wouldn't worry about, lots of stories straddle the line (like Dragonflight and the rest of the Pern books).
Fantasy. Just because there are aliens and alien technology, it doesn't suddenly become science fiction. Fantasy often isn't limited to just the planet we are on, and many times is part of completely different dimensions.
