I sold that piece to him that he was still making the same NOI, but did not have to worry about Maintenace, tenant calls, leases, paying bills etc. then at 2 years would get the balloon to sail off into the sunset.

That ship is just now setting sail, and we do not have the same kind of society that will permit the extraordinarily strict shutdown that China used to stop it, so it's likely to sail to its final destination - it won't stop until 70 to 90 % are infected, and with a death rate of 2%, 6 million dead. 

For some people, it would still sail through underwriting without a hitch.

With your new found equity you could have taken out a loan on the equity to pay the tax.An exception does exist which allows one to use the 121 exclusion for the sale of vacant land next to your residence, but that ship has sailed - the sales need to be within 2 years of each other plus a few other requirements.

It took about 45 days to get a renter in, but after that I thought it would be smooth sailing. 

I hate to burst your bubble Newbies, that ship has sailed, get comfortable with making deals work today, or wait till your old and its too late for you. 

I finally found a house that I am going to be putting an offer in today, and everything seemed to be smooth sailing until my realtor calls me and tells me that the property is not zoned correctly. 

The market will correct itself, but it may be rough sailing (for a bit) for the big outfits. 

Sail away from the safe harbor.

That ship has sailed though, and if/when the lottery comes back, 2-4’s will need to be something like 75% minimum occupancy (I don’t remember the exact #, but it was high.)