I will force the appreciation by converting it to MF while maximizing the square footage and maximizing allowable units on the lot.  

We plan on living in it and converting it back to residential for a few years.

Converting to a STR could be a great option for increasing rent.

My friend suggested I convert the 2 prong outlets in my home to 3 prong outlets myself as a learning experience (there's probably 20 to 25 to do) for future real estate purchases. 

Units list as 2br1ba but can be converted to 3brs with pocket doors for the front room.The analysis represents once the property is a pure investment property after about a year.

For home #1 we opted to put a boat load of $ into it to convert it into a legal duplex (which required underpinning, complete fire separation, etc.).

We also have a 401K that can be converted to a self directed IRA. 

Do the 1031 and then in a year or two sell your primary and take the $500K tax free and move into that nice investment property converting it from investment to your primary. 

One idea is converting it into a self storage facility . 

We have a client using a 203k loan to convert a mixed use property into a 4 family, and just closed on a 6 unit property for a client that was neglected by the previous owner and in desperate need of some TLC (but we paid appropriately for it).