Well, after thinking it through ( and discussing it with my better half ), we decided to leave it alone and just walk away. I spoke with the owner late today and then followed up with an email ( just in case ;->)
At the end of the day, we were able to get out of our lease and are no longer living with annoying, complaining, miserable neighbors. Life is too short and we are way too busy raising our family and eking out a living !
Yes we lost 3K, but in return we are now living in a bigger house up the hill, with more privacy, great neighbors, and I can go back to earning an honest day’s living without having to worry about what drama is about to unfold on the home front! Life is good !
Thanks to everyone who posted advice and encouragement – PIGGs Rule !