Properties that are acquired and held with the intent to rehab/fix-up and then sell/flip are considered inventory in a trade or business and do not qualify for 1031 Exchange treatment (nor capital gain taxes). 

We are expecting a termite treatment at our 4-plex.

Also, here is a thread you may want to follow as it will be a good visual step-by-step lesson. https://www.biggerpockets.com/forums/48/topics/259...

There are some fractional owner products that are designed to help you in situations like this like Delaware Statutory Trusts and TIC products sold by broker/dealers and syndicators that qualify for 1031 treatment and can help to ease some of these timing issues but you'll still want to make sure you have good guidance and keep an eye on your timing.

Qualified Use means that your relinquished property or properties and your replacement property or properties must be held for rental, investment or business use in order to qualify for 1031 Exchange treatment. 

Which means almost everything you read about the general tax treatment of residential real estate investment property is wrong.Dealers vs.

BUT you might be able to apply for historic tax credits, get favorable property tax treatment, etc.

The California Franchise Tax Board ("FTB") has ruled that certain types of installment sale transactions that have been "structured" or "drafted" pursuant to Section 453 of the Internal Revenue Code ("Code") and have been promoted and used to "save" failed 1031 Exchange transactions will not qualify for tax-deferred treatment in California when used in this manner.California FTB is Aware of Certain Installment ArrangementsThe FTB is aware of certain arrangements in which a 1031 Exchange investor and/or Qualified Intermediary attempt to convert proceeds from the sale of the investor's relinquished property that is part of a failed 1031 Exchange, or any unused proceeds from a partial 1031 Exchange, into an installment arrangement such as an installment note or other similar arrangement in which payments are to be paid out over two or more years.It was made clear by the FTB that these arrangements do not qualify for a deferral of gain recognition under Sections 453 or 1031 of the Code since, among other reasons, these sections and the federal doctrine of constructive receipt do not support such a deferral of gain recognition.These tax-deferred installment sale transaction structures have been promoted under various names over the years, including Private Annuity Trusts, Deferred Sales Trusts, Monetized Installment Sales, Self-Directed Installment Notes, among others.Qualified Intermediaries Put On Notice1031 Exchange Qualified Intermediaries must withhold and remit certain amounts to the California FTB when a 1031 Exchange either fully or partially fails.

They are only required to disclose material facts that are obviously wrong by visual observation and if it's rented out the broker may not have set foot inside.

Since I am a visual/ technical designer I am able to have a competitive advantage in the Vacational Rental area and I am pretty happy spending 3 days building quirky places/ experiences for people traveling and earning a good income from BUY/RENOVATE/RENTAIRBNB/REFINANCE.