The lender explained that the standard carve-outs include committing criminal activities on the property, failing to pay property tax and failing to purchase insurance for the property.

This means I would take over the loan and pay 2k/month on top of needing to come up with 280k.

Don't get me wrong, there are some great VAs out there, but you have to find them, train them, monitor them and pay them well for them to produce anything above mediocre results. 

They will supposedly first pay you back your initial earnest money with interest within four weeks of signing their NEW RELEASE AGREEMENTS as a show of good faith if you get in touch with their attorney (send me a private message so I can send you instructions to get in contact with their attorney), and then the remaining outstanding deposit with interest within two months after that.

Also  beware that  paying a large loan fee  may affect the lenders  ability to do the loan.

I am not familiar with who you are working with but always recommend vetting any company deeply before signing and paying -- those companies tend to have a lot of overhead they need to pay - out of your bottom line.

Buyers who pay a premium for living in one of the nicest areas of the city.

If they want to keep paying at 11 percent, good luck to them.

If you plan to be there LESS than 7 years, then I might consider NOT BUYING because if prices stay the same it will take nearly that long to pay down a mortgage enough to cover commissions and closing costs to sell and break even. 

Plus, you continue to build appreciation through mortgage pay down, as well as market appreciation as well.Timing is up to you… now if your potential new investment will cover the higher interest rates you see today.