It was not uncommon that they bought some of the worst houses (weird layout, dated, much deferred maintenance) in the nicest neighborhoods and then would try to relist them as-is to make a profit before ending up having to do the actual work required to the property for it to sell again, selling at a loss, or maybe making a little bit of money in transaction fees.

The property had a large amount of deferred maintenance.

You can do this through a 1031 exchange and still defer your gains. 

Cost segregation is a commonly used strategic tax planning tool that allows companies and individuals who have constructed, purchased, expanded or remodeled any kind of real estate to increase cash flow by accelerating depreciation deductions and deferring federal and state income taxes.When a property is purchased, not only does it include a building structure, but it also includes all of its interior and exterior components.

Lawsuits against HOA, HOA lawsuits again insurance companies, deferred maintenance that makes it not qualify for FHA loans, too many investors make it unwarrantable for loans, too many investors, force you to sell to another investor (investors never want to pay premium prices) and just so many other issues.I would say when your lease is up, sell that bad boy and either 1031 into a different kind of property or just take the cash and run. 

I'd do a 1031 exchange and defer capital gains.

Invest: you can have a self-directed IRA (or better yet a truly self-directed Solo 401k plan) and invest your retirement dollars into virtually anything you wish, tax deferred.

I completed Form 8824 in TurboTax as a combined transaction.From my understanding, this transaction is tax-free, and the gain is deferred.

If the one lender won’t, the next one will just wake sure there is no deferred maintenance.

There’s a major advantage here, especially for the seller, as it can help them defer capital gains taxes.