Use your energy on something more meaningful.

If yu claim one it doesn't void the option to claim the other one.Provided you meet the IRS requirements for both, as a tax strategy, you could complete exclude a portion of capital gains under Section 121 and then defer the remaining capital gains under Section 1031 (@Dave Foster is a great resource for 1031 exchange). ..

I say this to folks all the time on BP, but no lawyer/CPA can give you meaningful advice on a public forum like BP.

Quote from @Steven Foster Wilson: Originally posted by @Jennifer McCurrach:One PM takes 8%, one 6%.

It is about creating a balance between being open to new tenants and protecting your property interests diligently.By fostering a more secure leasing process, you can ensure that your properties remain profitable and that your relationships with genuine tenants are based on trust and reliability.

Just because you want to hit a specific number doesn't mean the market will meet you there.Great example of how Class C properties may appear like great cash flowing investments on paper - meaning fully rented, paying on time and normal levels of maintenance.

Quote from @Dave Foster: @Arthur Savery, This can be a great game plan called a diversification exchange. 

Quote from @Brandon Foster: Hello Ryan,STR is do able in the north county area but there are a lot of rules and regulations.The city of Oceanside right now will not allow anything STR unless it’s west of pacific coast hwy.This is changing a lot too so you need to be aware of that in your plans.Carlsbad is super strict too but there are some condos that are still available to do STR in.Medium term rentals are as safer bet but way less profitable.

If appreciation is not there, however, it seems like a potentially long waiting game to see if your $60k investment today returns anything meaningful in the long run. 

Not many have vendor relationships that allow for no out of pocket cash outlays before enough improvements are made for a meaningful draw release.