I thought about doing cash out refi, but my current rate is 3.5%. 

And I could have lower income in that window after I semi-retire, before my mortgages are paid off to take advantage of a lower marginal tax rate

With no experience you may have a bigger interest rate but if you have good margins on the hose, you should be OK.

We then take the utility bills determine base rate split and usage rate. 

And most are variable rates.

Perhaps someone with more knowledge on the neighborhood rental rates can chime in.

I really do try my best to be an awesome landlord, but it’s starting to not feel worth the time and energy.The house is at a 2% fixed rate so it’s hard to consider selling (at least right now), and getting the tenants out of the house would cost at least $5k per the Portland laws.

I think getting my ducks (management/ financing) in a row and seeking out a discounted MF deal makes a lot of sense.

That means they can get a 50% discount on the winning bid.If that's the case, they a) knew they'd kill the competition by smashing it to $200,000 and b) know they weren't going to pay any more than $100,000 for the house. 

Never even asked for the discount.