Moving forward scaling with hard money loans may be the best bet and would avoid the headaches of living in a construction project. 

If you could furnish the rooms, I'd say that is best bet for cash flow.

You're best bet is to call a few brokers local to the area and see what they can come up with.It's definitely going to be a surplus or excess carrier that will do it and the premiums will be high. 

Have you heard of Exchangers? 

One thing I'll add to an off-market deal is you might find a seller willing to do seller financing.You said, "I don't think the time exchanged to manage SFH would be worth my time and the cash flow most likely wouldn't be reasonable enough to hire a property manager.

I personally would look to a growing market and then exchange the money back to CA later, when things soften up.

Statistically, I would bet that many of these properties could be at risk from a similar event before the reconstruction could even be completed.What is the new premium on a $5-10-20M insurance policy and how could it ever be recuperated during the life of the policy or length of the average 30 year loan? 

Good luck, you are a busy man with school, family and baseball.Likely your best bet is house hacking (if your partner and child are willing to share housing). 

., deductions, 1031 exchanges), could potentially outweigh your current W-2 salary over time.Suggest a trial period for the first deal, involving him in decisions to build trust and confidence in the process.

The owner wants to sell for a 1031 exchange, and the property hasn’t been officially listed yet.