Now, you still have to comply with all of the standard 1031 rules -- including (A) buying properties that are at least as valuable as what you sell, and (B) moving all of your equity from the STRs into the LTRs -- then you may still pay some taxes even with a 1031. 

I live in Manhattan b/c of my wife's job and work in NJ.

I recently acquired a class B single family property it came with tenants.

Lately I have been using the BiggerPockets tools to analyze deals and it seems like essentially no properties will cash flow these days in any of the B+ greater areas.  

. - You don't want to rehab your property to Class A standards, but only have Class B & C tenants to choose from:(- How many rentals are in the area, where do the tenants come from?

If I ever buy OOS again, I'd go Class A or B.  

B or A do either.

My area has a, b and c class properties as do all areas.  

The home is a 3bed/ 2 b built 2005. 1606 sqft in decent condition.

It's a B- class neighborhood.Apparently there is some dog pee odor and some bad scratches in 2 of the 3 bedrooms and water damaged next to the kitchen (which is tile).The bamboo flooring flows through all the rest of the house except the bathrooms and kitchens.Would would you suggest?