No repairs require permits (roof good, 2 new a/c units, alarm system already in, new vinyl hurricane proof windows in), and to totally upgrade we estimate approximately $56,000 all in for rehab. 

Make sure you get proof of actual rents and security deposits as verified by the tenants through estoppel certificates.

Once they have proof of the violation you may get a warning, and then a daily fine. 

However, for many parts of the country, there’s a 7th bullet that will blindside folks who got in too late: regulation.

My PM said I need to have solid proof of the sublease to start the eviction process.

Proof of rental income?

So do they expect you to completely child proof the house for them?

Consider it a blessing that she flaked and kept ignoring your original offer- Dodge the bullet NOW....DO NOT RENEW HER UNLESS SHE PAYS AT LEAST CLOSER TO MARKET RENT..... if you think your unit doesn't really meet market standards to get market rent, then at least get it closer or at minimum keep it "as is"...

If you want proof, DM me.

The five bullet points that you have posted contribute to confusion about the question you are asking: Should I sell my negative cash flowing property that I over leveraged?