Not sure what new tax laws bring to the table.

To get the tax benefits of a live in flip you would have to live there for two years. 

And you did this without paying any tax.

He is claiming to be able to wholesale using the MLS.

Just make sure to familiarize yourself with how Texas taxes work. 

Our mortgage payments started at $2300, but due to increasing property taxes and insurance, they have alarmingly risen to just under $3300.

After two years I understand for tax purposes I sell it as a rental.

Now you have a brand new property that has no mortgage, rents for $2,000 a month with $300 a month in taxes, insurance ect…profit $1,700 a month.

Im in NJ, but not sure it's the right market for me due to very high taxes and cost of houses. 

In your case you have a lot of losses in the time you own the property but these losses transfer through to your personal tax return, so you can recover some of it and not have to count the full nominal amount.