Contact a couple contractors to see what the cost would be to add the addition.

A 1031 exchange is NOT available for owner occupied property so that’s the bad news.The good news is for owner occupied primary residences, for married couples, the first $500,000 of pain is tax free.No need to worry about a 1031, live in the house, sell it, use the $500,000 exclusion and you pay KP tax on whatever profit may exist,2.

It's also a couple days work.

I don't personally have tens of thousands in cash on hand for larger down payments (I do though in my TSP/401k), but my dad will have maybe a couple hundred thousand after the sale of his house soon.

I do have a couple that had appliances already but I don't warrant them in the lease.  

I've had a couple of elderly vets who considered allowing the buyers to assume the loan, but this is rare.

I’m in a different situation with no kids and not married but I would still urge you to find a way to pay off CC debt.  

I am more than willing to do something like this on my own in the next couple of years when I am ready but we are looking to get started now.

The small multi family space (4-20 units) seems to be less crowded, but those deals can be hard to manage unless they’re within a couple of hours from where you live so you could manage or turn it yourself if you had to. 

I acquired a 3-flat in Humboldt a couple months ago who had two units not paying (ouch).