The only downside is the moratorium on septic systems, and the sewage treatment plant being at capacity.

Mike, I'm with @Jon Holdman on this, flips don't qualify for 1031 treatment, and get taxed pretty heavily as he stated above.  

Of course she does not have money for the treatment, so it looks like I'll have to pay for it.  

Talk to the landlord and let him know your thoughts on the outside garbage on his property that is an eye sore to the neighborhood, but you cannot tell him how to screen his tenants.Joe Gore

Spreadsheets will tell you what to do from there.As for the PM....yeah i'd replace them too.        45k investment plus maybe 5k in damage/treatment isn't a horrible deal.   

Often after first or second treatment your tenants will stop complaining. 

Buckle down and spend money for the treatment from a professional.

The FHA loan may require the seller to perform repairs, or pay for termite treatment.

If your intent was to hold the property for productive use in business for trade or for investment then you could do a 1031 and you could get capital gains treatment if the closing of the sale crossed over that 5/27 date.  

Of course you could do an engineered cost segregation study to reclassify some of that depreciation to 5, 7 or 15 year asset lives with accelerated treatment.