Looking at the outside shot of the home, I can see that the roof isn't in perfect condition... it's either really old or structurally there's something wrong with it and I know roofs are a VERY expensive thing to address.

I'd suggest option #1, but there's a second step that you haven't addressed.

Consider an excessive use clause for utilities.Talk to your neighbors and let them know to notify you with concerns.

Again, happy to schedule a call to discuss our capabilities with you thoroughly so you may understand what we do and why we are so successful.Our utmost concern is always addressing any misleading information that is being perpetuated online mitigated through verifiable data and facts.

I told them because of HOA requirement of 12 months we can't do that and we hung up the phone.But voice in my head told me to talk to them again and see if they can do 12 month lease.So I did and told him that we have to do 12-month lease and they still will be liable after they leave until we have another tenant.His counterproposal was, that we make a lease with his company for 12 months and they will pay me regardless of a tenant being there and they can rotate clients.My concern was I don't just want anybody in my home and he said he will provide me with appfolio's tenant screening and when we give green flag then and only then they will move tenant.

To address that, I am exploring additional income streams that will boost income for my properties. 

Send me over the property address if you're still in need and I'll send you over a ballpark number.

We would be depending on the rental income to pay most of the mortgage/taxes/insurance, but are concerned that Galveston may be too saturated with similar properties and that we might have a hard time getting enough renters to earn that income.We'd love to hear from others in the area who host STR property.

I am concerned about calling them back and letting them know we want them out regardless as this could lead to property damage.

The reason I am so concerned about them being commercial is because I know that you have a lot more control over the value (using NOI) than you do with residential (determined by market comps).