I've lived in the condo so I would be exempt from paying taxes on Capital gains up to 250k.However I'd be letting go of a low interest loan of 3.375% which is tough to get in this market.I would like to purchase more properties so I feel that having this first one will be useful to show lenders.Am I missing anything else?

I have a very specific tax question regarding the UBIT (Unrelated Business Income Tax) exemption in Solo 401(k)s that is normally triggered by UDFI  (Unrelated Debt-Financed Income) in IRAs.  

With your primary you have a 1021 exemption you can use up to $500K (Married Couples) and if there is any gain above that then you will also have capital gain taxes on that. 

Then you would get to take a partial exemption tax free. 

Homestead Exemption - You don't even get a conversation unless this is your "primary" residence.

How about making rentals property tax exempt?

Talking to zoning officers, I find that in some municipalities they are grandfathered in, but in others this exemption ends when the lot changes hands.What I am seeing is a picture of a huge amount of semi-rural land that is frozen in time—impossible to use and therefore impossible to sell.

Also, this would give more time thus putting you in Long Term Capital Gains Exemption if you've lived in the home 2 of the last 5 years. 

Is it possible it remove a homestead exemption and is it a good idea in the long run?

It does not look like late fees are something you get exempted from the limits on amount.