One wall is saturated and thank goodness without cracks.

That's how we are able to have successful STR without dealing with "the Airbnb bust", over saturated, low bookings, and everything else you hear. 

Each have 2 and 3 bedroom mix, near universities, C+ (ish) type properties competing against large scale, A+ type properties, reduced enrollment, possible saturation, etc.  

They have backed out of Memphis a bit saying the rental market is saturated. 

Repair wise do you think I need to rip out the saturated dry and wood floor?

Not to further stomp on your parade, but direct mail is also highly saturated in this market, so you will need to use a mail list that few others are tapping which means it will be hard to build and/or door knocking distressed homes which others don't have the time or huevos to do ... even if you do find those distressed homes, they will likely require all cash and hard money lenders won't loan on your primary residence.

The Problem: After years of mailing, this saturated market is raising the cost per closed deal. 

@Kim Meredith HamptonThe septic system was just repaired and the backyard had drainage issues which were saturating the drainfield.

The place reeked.Once the flooring had been stripped, we discovered that subfloor in the hallway (picture #2 above) and in two spots in the living room was saturated with animal urine.  

I hate to be the bearer of bad news, but if you are living in it and paying property management the rest of the year, you will not cash flow. 20-25% property management for STRs quickly eat into most cash flow when buying in todays FL market.the STR market is saturated and continues to get worse. in turn you have less occupancy and less income. in the next year or so, we will evaluate if the STR market is viable anymore where we are at.