Some buy to park money, others do 1031 exchanges or they simply buy them for a tax write-off. 

Once the property is sold we will be able to pay off the HELOC and will also have further funds coming in the following year.

It just takes time for most investors to become “rich” off real estate.

Just remember though unless you have deep pockets you need to at a bare minimum stay cash flow neutral until you get the property running and your debt paid off.  

Would you be better off just writing VRBO a check?

You may be better off refinancing with a cash-out mortgage and then financing the new property.   

There are many STRs that do quite well in the suburbs of major cityies Off the top of my head, I can think of one of the STRs we manage that is 40 mins outside of Dallas and it has a great occupancy rate.

Call every local investor agenda (look at the agents that have investment property listings and call them) and call every local landlord that owns multiple properties (you can get lists off of Deal Machine).

My property manager called (I live in Denver) and told me they got it turned off pretty quickly, but a whole wall's worth of drywall was damaged. 

Normally the escrow agent will want mutual sign off even if its clear the contract terms indicate one party should be awarded the escrow funds.