You may consider negotiating with your tenant to see if a rent increase in 3-6 months might be a suitable compromise. 

This would improve the cash flow problem allowing you to take advantage of the appreciation until you find a more suitable alternative.Option "E" - get rid of the HOA fee so that you break even - totally kidding. 

With 15M + visitors flooding to Nashville every year, the demand for hotels and short term rentals is sky high.

If we sell it, it is not suitable for someone to live in.

Regarding a liability waiver, this is likely to be baked into most leases in one way or another, but it may not be the tenant suing you, it could be a guest, a visitor, a contractor (one HUGE reason to make sure you are only using licensed and insured contractors on your rental properties), or some random stranger - it's not feasible to have them sign waivers. 

IMHO, this is going to cause a large reduction in the number of visitors, with negative effects on the city's economy. 

Check with local realtors and/or investors to see if this is a suitable investment.

. ; )   But I dont know why you would want to deny a suitable tenant 

I would appreciate any guidance regarding how to choose a suitable market to invest in! 

If I have anything over $1200 available, I can expect it to take 1-2 weeks to find a suitable tenant.On the other hand, if I have a rental that is $1050-1199, I can usually find a suitable tenant in 1-2 days.