Moving into my rental property and making it my primary residence

[Kevin Meyer]

I recently was notified my tenants are not renewing their lease to a rental property I own. I would love to make it my primary residence and would love to hear other thoughts on my pros/cons list.

Pros:

I have about 50% equity in the property right now, so I could refinance and pull some equity out and maintain a primary mortgage interest rate. (current interest rate is 3%).

Avoid paying some capital gains tax if I live there for the next two years and decide to sell.

My girlfriend and I could get out of my parent's house and have a place to call our own/finally get a dog.

Still house-hack by renting out 1 of the 3 bedrooms. 

1 mile from the beach, in a beach area.

Cons:

No more living rent free at parent's house.

No more $600+ cashflow from the rental. (It will actually take about $600 out of my pocket even with renting out a room).

Can't refinance without getting a rental property mortgage rate.

Would rely on a 1031 exchange to avoid paying tax in the event of selling. 

What are some of your thoughts when looking at the aforementioned? Thanks in advance.