Very energy efficient and near the Rockwater Village development.Because I am new at this and we bought another home because my wife and I are expecting our first baby :) I am strongly considering using a property manager (worried about time and attention with the newborn).

Don't loosen your standards just because you have cash to burn.2. 

They basically stripped it down to the studs and this was just a small arc in a junction box in the attic that burned a ceiling rafter.

Many new flippers get burned on flips because they pay too much for the property or don't pay attention to seasonality.

Does the guarantee burn off at some point naturally in the primary term of the lease or is there an early termination clause if certain sales numbers are not met?

I'm looking in Jacksonville and I'm loving everything about it it looks like something I should continue focus my energy on and the prices are relatively low

Utility costs, energy saving programs, regular maintenance costs, every little bit helps especially in the early stages!

Listen to me, if the house burned down today and I had to sell just the land, it would still be a great deal.

Alternatively, leaving the insurance in your friend's name raises an interesting issue as to whether the insured (your friend) has an insurable interest in the property (and thus has a right to insurance proceeds if the property burns down).   

it is currently a 2/1 that I am going to make into a 3/2 by taking out a large wood burning fireplace, shrinking the closets and moving the laundry into the garage.