So fixing and keeping or selling and paying the tax are about a wash.So if you want the better finance decision it would be to sell and 1031 exchange into a vehicle like a DST or TIC if you want passivity and fractional interests. 

The difference is that you own a fraction as part of a syndicate.

@Jeff AdamsLeverage means you put in a fraction of the cost and the bank puts in the rest.

The strategy to be selling fractional ownership in the project that would be converted to lot #x upon completion.

Lots as a general rule trade at 25% of the finished homes value.. its a general rule but a 500k home lots normally go for 100 ish. of course that does change a few years ago in some markets you could buy 10k lots and sell 200k houses.. think OKC  TX those areas were new construction is built for a fraction of the price of other markets. were that can be inverse is say in an area like Palo Alto or SF peninsula were you may pay 2 mil for a lot and spent 1 mil on the house and sell for 4 mil  :)  2,500 sq ft maybe smaller. 

However, I am confused about whether I will continue to claim depreciation for 2020--I imagine that, since it will be used for the production of income, I will depreciate it, multiplying the full annual appreciation amount by the fraction of time that it was actually in service (e.g., if I place it in service for half the year, I would take half of the 'normal' depreciation).

As I work through some of the IRS worksheets, I am wondering whether it is normal that there is a difference in the fraction of depreciation one takes on a rental property that was only rented for part of the year, and for deductible expenses incurred during that same year, if the property was idle for a period of time.For example, if I rented out an apartment for the first eight months, then the apartment was vacant for the remainder of the year (needed some work that I did not have time for), would I be able to claim 100% of the depreciation, but only 2/3 of the deductible expenses for that year ?

@Alex Kim do you know if there are any tic fractional financing available in LA?

Delaware Statutory Trusts are a way for investors to own a fractional interest in institutionally managed real estate.

They had regional meet ups to share and market their properties and put these wonderfully complicated but fun daisy chains of exchanges.And of course there's a few companies out there that have a stable of properties (particularly the fractional DSTs etc) that have properties you can actually look at.But the current 1031 regs really make this unnecessary.