You cannot 1031 owner-occupieds OP, you are perfectly willing to accept  the other repair costs, closing cost, moving cost, 3% agent commission, but somehow you can’t live with any taxes on your profits?  

It will be very difficult to obtain a loan for buying into a Co-op, I have a buddy who bought a co-op in Rogers Park awhile back few years ago and he said it took awhile but was able to get it done.

Aloha,Well, a little late to the party here, but based on OP's last, definitely should have formally, in writing, rescinded the renewal offer, and then send non-renewal with appropriate notice.

But this isn't what the OP is talking about.  

Additional note on MileIQ:  It's been sometime since I tried it, but at that time it was very U.S.A. centric {not a problem for the OP} and not terrible useful for those of us elsewhere.  

I know the OP is a long read...

We have occasionally done double deposits on tenants who had job losses/bankruptcy but had gotten back on the right track with payments and new very high paying jobs (in the aftermath of the financial crisis).One of the issues the OP has is that if you get the number too high for damage, they might find themselves in front of a not so friendly judge.

Basement has coin-op 2 washer/dryers.A few rusted radiator vales need to be replaced, I am budgeting $600ExteriorHouse has little curb appeal.

@Christian Bors, the OP said the tenant lost their job.

@Gregg Pauly looks like your OP was a year old.