The only way to avoid that with a 1031 exchange is to have the note go into your exchange account and then during the exchange period you buy the note out of the exchange by swapping cash from any source with the note in your exchange account.When you do this you are able to defer all the tax in the 1031. 

However, the market has changed in that time period with interest rates changing and homes staying on the market longer and longer.You mentioned the big ticket mechanical items for the house, but it sounds like paint, flooring, kitchen and bathrooms we're mostly untouched.

I know there's the inspection period and buyer must perform due diligence BUT it never is normal to research permits for every single plumbing fixture, electrical box, all liveable areas, etc.

My tenant travels extensively for long periods of time.

If you do buy a new build, make sure you still get an independent inspection done and regardless of where you buy, go and look at the property in person during the contingency period. 

Vendors come and go, so they may have periodic void in certain niche vendor skill sets.

@Tim Bender  Are you only pursuing deed's after tax sales where there is a redemption period in play? 

Enjoy our vacation rentals for longer periods of time.

Hi Jared,For my furnished properties, I personally use Airbnb (and set to 30+ days for minimum rental period) and Zillow.

Depending on your time period for construction, a heloc could be a great option as it provides flexibility and then you can always reuse later down the road.