So all of the gain and depreciation recapture are initially still tax deferred.However, like Joe said, the down side is later when sold  you lose the 1031 option. the client will pay tax on all gain and depreciation recaptured from before the 1031 also. 

I did a lot of research on options.

This is typically HIGHER than option one. 

Looks like you have some good options in front of you @Martin Phinney.

The land banker, the long term landlord, the neighbor that wants to expand their home, or the horse owning owner occupant with no other options?  

Just an option, we love it.

If you need an option that isn't as document heavy, a DSCR cash-out might be a viable option if it's an investment property.

This will either eliminate or open different options for you.3.

I believe it to be a little Southern California hidden treasure for cashflow, mainly class C but if you know what you are doing its a really good option to invest locally in CA with decent returns.

I had an experience with a terrible tenant who reported me for a bogus claim but by making the claim it allowed me to gain access needed to get photos of the condition of the property, and then the tenant refused to allow maintenance people in which really helped prove my side of the situation.If possible, explore alternative dispute resolution options like offering the tenants a cash-for-keys agreement.