The more doors that you own, the more you can spread and mitigate your risk.

The mitigation is you're selling is to make sure you or your attorney have all the required documents when you put the property on the market & make sure there are no surprises regarding assessments.

I went and performed mitigation measures which were OK'd by the insurance agency. 

I would always prefer the 10x $100K houses under professional property management (just to counter the kitchen and toilet argument) because it is a form of risk mitigation.

This is a risk that is mitigated with a thorough inspection.  

You have to educate yourself on how to mitigate the risk.

I'll include, the main point of diversification is to mitigate risk.

Do you have any suggestions to help mitigate a decent size capital gain (other than dumping proceeds back into a 1031 exchange)?  

So, I'm purely trying to mitigate my risks and damages by trying to come up with the best solution to provide the best outcome. 

My initial solution is to re-finance my current home into a conventional second home/investment property and to maintain primary residence there until I hit the two year mark of occupancy to mitigate capital gains tax.