It is also my understanding that this would result in large tax returns (from depreciation offsetting my other active income) that I could use to continue to expand my portfolio. 

:D To OP: I also struggle getting deals.

You would continue to defer all of the tax and receive potential cash flow until the market becomes more attractive for you. 

Rents could continue to fall, and the cost of labor rise dramatically.https://www.cnn.com/2024/11/19/economy/new-home-undocumented...

This is where I am struggling to figure out what the smarter option would be.

Fannie does have a guideline that allows a property to be deeded over to an entity so long as the original borrower is also in the entity, but you have to wait 6 months of seasoning and maintain continuity of ownership.  

She will say, "I will just text them that Ill come check out their issue etc"  and I'm like "first of all, we do not text them, we send them a message on the portal, do NOT give them your personal cell #"   yet she continues tod o it, I was told last night that we will definitely be letting her go. 

And a little skepticism that the market would continue to grow at 5% or more on average (it's been ~7% average for the 8 years I've lived here)@Dave Foster I filled out the BP spreadsheet here for the sell or rent decision, and similar to you advice, selling and investing the profits in index funds performs only slightly below being a DIY landlord, making that seem an attractive option. 

This appears to be continuing into the fall.For some broader context, here’s a chart of the median sales price of a single-family home in Austin over the past 10 years:Compared to the recent median price peak in May 2022, single-family home prices in Austin are down approximately 19%.

Focus on your current sales position and continue building on that.