It sounds like you're in a pretty good position with some nice options.

If the only MFH options you're finding are in areas you're not comfortable with, it might be worth focusing on a duplex in a better neighborhood.Saving up for a larger property later is a valid approach too, but keep in mind that real estate tends to appreciate over time, and waiting might make it harder to enter the market later.

You have to determine if the additional complications and costs are worth the investment in a Title Holding Trust or Land Trust.  

Northern NJ has options as well, but MTR works better in a lot of areas because there is demand.

If they’re selling for a $400k+ gain they could look at a 1031 for:A super nice 2-4 unit they wouldn’t mind living in a unit of where the rental portion exceeds their 1031 sale. 

All of that said, nothing you mentioned sounds like you are in a position to evict anyone.

You're certainly correct, this market it pretty awesome, which brings in a lot of competition. 

Similarly, if you put all Class D tenants in a Class A 4-plex, what do you think will happen?

Your competitive advantage comes from experience, knowing your market, and seeing greater potential in a property than what others may see.

Yep, I'm in a ATM deal with Paramount, through David Zook, and they missed their quarterly payment this month.