The house is now listed for sale and he came out of no where and sent me a notice of intent for lien. ($65,000).

The qualifier is your intent. 

But his intent must be to hold for investment purposes for the time being. 3.

Granted all of my are within a mile of me (intentionally), I do most of the repairs myself. 

Tenants are also a lot less likely to do intentional damage in this scenario.

The listing agent's job is to get the house sold, while they may not intentionally skew the comps they are also not going to tell you if their listing is overpriced.

@Isaac D.Are your intentions for this new property to be a primary residence or an investment property?

Depends what the intent of the property is - if you are going to flip it, will go on your balance sheet as inventory and any costs associated with improving or rehabbing the property will be capitalized to the cost basis of the house (roof, walls, bathroom, etc).

In order for a property to be eligible for a 1031 exchange your intent must have been to hold it for productive use. 

Approach existing clients with the prospect of me renting their home with the intent to sublease it as a vacation rental.