Margarita - I agree that he should be making a transition to 1 nap now. Try to keep him awake until he is napping close to 12ish. Take him out of the house, provide lots of stimulation, etc... and as you get closer to nap time tone it down. Give him extra long wind-down and then lay him down to nap at 12pm. His day should look something like this:
6-7am - wake
12ish - nap (1.5-2hrs)
7pm - bedtime
If he wakes in the morning (which I suspect is from the o/t state he has hit from the late bedtime and incorrect napping time), I would do wi/wo or pd. I would cut out all the milk at night. He does not need it and he will be waking up and using it as a prop - which is something you don't want. I would water the milk down until you get to just water and then eventually place a sippy cup with water in it in his cot and let him know if he is thirsty, it is there....
As long as you do end up "giving in" and taking him back into your bed or giving him milk, then this will just keep on continuing. Don't worry about the neighbours... the most important thing here is to get your lo sleeping better and to keep him well rested.
I would definitely work on the nap for now and I bet the nightsleep will get better as well. Try to commit to this for a few weeks so if you have to do errands, don't let him fall asleep in the car. Do what you have to do before or after the nap... if he is taking catnaps, this also leads to restless night sleep.
See how you go
Layla