Capital Gains Taxes with 3 Year Lease to Own Contract

[David Oliver]

I purchased my first home in 2011 as a short sale and remodeled it and lived in it until April 2016 when I purchased a 2nd home as my primary residence. I kept the first home and had a tenant sign a 3 year lease to own contract in April 2016. At the end of 2018 the tenant has stated that he plans to purchase the house per the negotiated terms so I will net roughly $80K from the sale of the house.  

If it plays out like this, am I subject to capital gains taxes on the $80K and am I going to have to look at doing a 1031 exchange? 

Or am I in the clear since I will have lived in the house for the 2 of the past 5 years?

Could I make the argument that I technically "sold" the house in 2016 with the lease to own sales contract?