Why did the former owner not execute this strategy? 

I have experience managing this on multifamily properties as both an owner and a lender.

Short term rental permits are only granted to owners who will be renting their primary residence.

This initial conversation before the owner has a property can be very educational especially if the owner is out of state or has never been to our city.

NO PRIMARY RESIDENCES, NON-OWNER OCCUPIED ONLY, BUSINESS AND COMMERCIAL USE ONLY.

Gamal is the owner.

In your case, transferring the property from a revocable trust to an LLC where you and your wife are the owners should not affect the 1031 exchange, provided the LLC is a disregarded entity for tax purposes . 

In the last 18 months various states have instituted new rules, regulations or laws related to (1) need for licensure to wholesale (2) restrictions on marketing of a property in which you do not have ownership and (3) disclosure requirements when dealing with a homeowner that makes it clear to the homeowner that the contact signed with the wholesaler is not a definitive “sales” contract, therefore making it less likely home owners will sign4.

The units are all sold so the owners make up the HOA, but without a board the only person calling meetings right now is the Management company. 

At the same time, I’ve been seeing a lot of distressed properties sitting because owners don’t want to deal with the process—permits, contractors, tenants, refis, all that.