He or she entered into an exclusive sales contract with you (and removed the property from the market) based on a set of terms that presumably did not, at the time, include the first floor unit being vacant prior to transfer of title.

I'm switching to electronic signatures now and every lease will have a cover page that advises them they are responsible for reading and understanding the lease, advising them to consult an attorney before signing, and then making them initial that they've read and accepted the agreement.

So, I figured investors with more experience saw something and I offered the list price which later was accepted.

The family can refuse to accept the property.

Sorry, no one cares what your Credit Karma or Discover Card says, the AUS will not accept that, and the AUS is the decision engine. 

I think that part of it is accepting the fact that while important, investing is not the top priority right now. 

That seemed like a reasonable amount of effort or should I throttle back to initial, counter by seller (if they don't accept), then go straight to BAFO (Best and Final Offer)?

Also there's already a tenant in place, so you know what you'll make from rent and that it's cosmetically acceptable to rent.

The point is Athens would be a good place to start your investing career.You should research a few strategies which are not mutually exclusive -- student housing, short-term rentals, co-living, house hacking, and BRRR.  

The choice to accept section 8 is completely up to the owner/landlord.