I'd be pretty irritated over the loss of 6k, 4 months of stopped work and the corresponding holding costs.Do you invest in OH, or somewhere else?

Non-passive losses can offset non-passive income (like your W2).

Your loss is limited to the amount you invested.You can sell shares of publicly traded reits on the stock market during trading hours.

I have suspended Passive Activity loss that would reduce the gain, but not eliminate the gain from tax POV.

Depreciation typically results in a tax loss.

If you operate the vacation rental as a short term rental, you will be able to take advantage of taking any losses you have on the property against your ordinary income.

Section 469(c)(7) provides an exception that allows qualifying taxpayers to treat rental real estate activities as nonpassive, enabling them to deduct losses against other types of income.

I have seen instances where a 1031 exchange was not required such as1) The overall gain from the sale of the investment property was very small or even negative2) The taxpayer had enough passive loss carryforwards to offset the gain.A 1031 exchange is a very powerful tool put it has to make sense before going forward.

That, combined with hidden repairs combined with self-managing a low income could all construe to thousands in losses. 

So for him, paper losses are good.