I have owned a few rental properties (mostly primary residences converted into rentals).

Because unless his gains are higher than 500K, converting it to a rental as a tax strategy is terrible advice.

Where I'm located the housing stock is predominantly quads and smaller... and its almost all converted SFH that are 100+ years old to boot (translated = rotted sewer lines, knob & tube electric, lead paint, asbestos siding & pipe wrap)... all the things that say OPPORTUNITY... and I've been missing it for over a year!

If you have family or friends that live in the South or Mid-West, start looking at rentals there, as these are classic cash flow areas....probably not going to make you 10% year-over-year appreciation like Oregon has the last 7 years, but you'll convert your appreciation into monthly cash flow. 

My plan for several years has been to buy owner occ propreties and convert them to rentals when I move to the next.   

BUT, that being said, both these tax incentives are massively powerful tools for RE investors, and it pays to do your research and learn the ins and outs -  it could save you big $$$ when it comes to tax time.Here are a couple helpful articles on the 1031 121 combo: https://www.1031exchange.com/converting-property/http://www.exeter1031.com/article_overview_1031_12...http://www.exeter1031.com/application_sections_103...https://apiexchange.com/1031-exchange-primary-resi...Either way you go, it sounds like you're in a good spot.

Wealth Warriors,Does anyone know if you can convert your TSP into a self-directed IRA?

It was originally our primary residence that we converted to a rental when the housing market was bad in 2009 (couldn’t sell it) it’s never been a good rental as far as cash flow.

So it may not even come to pass.If it does, there’s lots of ways around it (I foresee all kinds of advice posts for Bay Area investors on converting units to Tenancy In Common or Condo Conversions).Also, keep an eye on the migration to Las Vegas / Henderson, Nevada and the Phoenix Arizona Metro Area over the next few years should it pass…Las Vegas was already named the #1 hottest market for 2018 by Realtor.com (probably because everyone in California over the age of 21 has already been there):http://www.fox5vegas.com/story/37301190/las-vegas-named-hottest-real-estate-market-for-2018And the Arizona Sun Corridor (Prescott to Nogales, running right through Phoenix) is set to double in population by 2050 (up to a whopping 12 million!)

We converted the property from a 3BR 1BA into a 2BR and 2BA with a full master suite with walk in closet and stand up shower with double vanities.