Here's a quick breakdown:Unforeseen Property Issues: Hidden damage, bad tenants, major repairs – these can eat into profits.Vacancy Woes: Empty units mean lost income, impacting cash flow.Market Downturns: Property values can drop, affecting your investment's performance. 

We have managed to build a solid liquid nest egg, but I'm hesitant to lock the majority of it up in a low LTV mortgage on a really expensive primary residence.

They eat where they want.  

That means, when they are damaged it doesn't eat up the whole security deposit leaving more money to cover other damages better protecting me. 3.

I plan to leave them enough that they can afford to buy a house or start a nest egg, but I am not leaving large sums to them.

I would say for most people, the 1st position heloc is no a good bet, especially if you have a 1st mortgage rate of less than 5%.Using this strategy with a 2nd position heloc can be just as powerful, so you can have your cake and eat it too!

We plan to remove them all to protect from tax increases on our current primary, but I am afraid that now that the other properties won't have homesteads, we may see skyrocketing tax bills and it will eat into already small cash flow from rental income.Does anyone have advice for how to handle this situation other than just increasing rent?

Some people make 4x the rent but squander their income on eating out, drinking, car payments, etc.

That is what I am trying to figure out, "what is the problem trying to solve" I view this as a problem for the current owner - who wants their cake and eat it too.

Just because I am bullish on bitcoin doesn’t mean I’m going to put all my eggs in that basket.