They pay themselves good "salary" from the loans they get.

From what I understand, a 1031 exchange doesnt apply in this case, and so I will have to pay short term capital gains on the appreciation ?

Additionally, we have equity of approximately $145,000.Now, we are faced with a dilemma: should we sell our current property and purchase in a more favorable neighborhood, or should we rent the house and let it pay for itself.We would greatly appreciate any advice you may have.

Landlord will promptly respond to Tenant request for repairs but will not be monetarily responsible for tenant disruptions or inconveniences during habitable times of repairs or tenant/guest injuries incurred in or around obvious areas of maintenance, repairs, or construction.We are more converned about them expecting us to pay for their losses rather than getting recouped for damages to our property. 

I have no problem paying a wholesale fee if there's plenty of margin for me. 

You can pay for expediting for plan reviews and the best way to "expedite" beyond that is to make sure that your engineer / consultants are submitting complete packages each review cycle.

OMG, please do  NOT take money out of your 401K to pay off a mortgage, especially not for a rental. 

I'm assuming I would have to pay it off if I won the house. 

That being said, I'm always an advocate for paying for mentorship to fast track your goals. 

Withoutknowing the details I can not suggest which would be right to add on.Several you should pay attention to are:- Ordinance & Law: Provides additional building coverage to deal with rebuilding costIncreases due to changes in Zoning or Building laws- Personal Injury Liability: Libel, defamation of character, wrongful imprisonment, etc.