I'd talk to someone who is knowledgeable in real estate law in your area to get the specific laws regarding shared fences and property damage.

I am wondering if anyone has any experience purchasing a vacation home (specifically in Key West or Arizona, but advice from anywhere would be great) and renting it out as an AirBnB, when it's not being used?

Also while going through the education, determine what is one specific niche you'd want to concentrate on!

But I don't know the specifics so maybe you found a diamond in the rough. 

You could go under contract with specific contingencies like financing and inspections.

Sometimes I’m not sure if my MAO is accurate since I’m learning the business on my own as of now.However, let’s say “hypothetically” a specific propertyARV is between $775k to $800k, asking price is $995k and repairs is estimated between $30k-35k.

You might need more specific exposure, so try FB buy, selling, trade groups, C-list boards in our neighboring states, and maybe put it on the MLS.

If you don't have a very experienced property manager who specifically deals with that area, I would pass.  

Remember that your current tenants won't live there forever, so make sure that you can manage the property without those specific tenants.

These are just estimates though so I'd definitely recommend giving someone all your details and getting numbers that are specific to you.