In my experience, you can purchase the existing home and the encroachment is grandfathered in, meaning the vacant lot owner can't force you to move it.

The seller needed to move out of the country so they wanted to sell and shut down the property.

If you have lived in the property for two out of the previous five years you could qualify for the 121 exclusion, where you get the first $250k ($500k if married) of the gain tax free.

I’m new to the community as well as real estate investing.  

If you read my previous post, I emphasized the importance of showing up for the right keywords.

You want an accountant who can help you strategize and who is responsive when you want to know the consequences of the financial decisions you are making throughout the year.Good luck. 

Naturally your relinquished property must be sold before you can take title to the new property, but its a great way to make the process as smooth as possible.Even though the time frames can feel daunting I find that 95% of exchanges from my clients are successful.

Most of the big land wholesalers whole-tale the deals, meaning they actually buy/close on the land (using their own money or other people's money) and then list on the MLS to sell, because it is very difficult to find buyers without widely marketing it. 

Your loss is limited to the amount you invested.You can sell shares of publicly traded reits on the stock market during trading hours.

Photos of the place as is: