Refinance, Sell, 1031 Exchange or What?

[Alexander Filatov]

I am seeking opinions from experienced RE investors and/or landlords.  I have an interesting dilemma at my hands and really puzzled on my next steps.  Perhaps someone with experience could give some guidance.

Deal facts:

• I own 2BR/2BA condo in San Diego, CA 92130
• Bought it in 2003 for $346k at the peak of the market
• Current estimated value $400k - $420k 
• Current loan balance $300k
• Current P&I payment $1745.53 at APR 5.25% - 30yr fixed (I know that 5.25% is way too high today)
• Annual tax - 4,450 ($370 mo) 
• HOA - 285 (mo)
• Current rent - $1900

I am about $600+ in the hole per month on this property and the only benefits i realize now are the potential long-term appreciation in value and tax write off in the form of annual depreciation and losses.

Looking at several options now:

1. Refinance at a lower rate.  Perhaps go with a 15yr or even 10yr loan to pay it off faster. That would put in me the hole even more but the financial pain won't last as long as 30 yrs.

2. Sell the property -- do a 1031 exchange into another property (not sure where though).

3. Do nothing (that would not be smart but it's an option)

4. Sell the property and pump the proceeds into my primary residence.

Any advise or suggestions would be greatly welcomed!

Thank you in advance.