I finally did, in January of this year, and have been enjoying it immensely. 

Assuming the STR meets the requirements of a vacation loan, you'll be able to get a 10% down loan for the STR, which will likely give you the highest CoC return possible. 

Any other ideas I can implement before sending him the notice to vacate?

Property would be purchased 100% OPM.This is a desirable vacation spot for potential purchaser as well and would use 4 weeks out of the year !

My advice is pay the other 30% of rent and give notice to vacate.

But when you find that strategy that fits you the best and that you enjoy as a sport or hobby, it is usually the one you will prevail with the most.

Speaking as an agent I'm going to voice an opinion that's unpopular (with agents), which is that if you are dealing with a competent agent who you enjoy working with this should be fine, but if you're not, the agreement ties you to someone who isn't great to work with. 

Market research is so important because not all sellers enjoy the small talk.

City then gave them notice for 2 to vacate….didn’t matter in the least that they had a signed lease with the property owner.

I have delivered my non-renewal to one of the tenants but I have not seen any progress of her getting ready to vacate the property.