Your ability to borrow.Take inventory of those 4 basic things and it should point you in a direction.

What other benefits result from the improvement. 

Some contradiction in thinking here too, you need to make improvements to bring the house you're looking at up to the standards of comps being similar.

Commercial tenants are different as they can account for leasehold improvements, expense and depreciate the items, but not a resident, residents cannot account for maintenance on taxes and the owner has that responsibility.Maintenance of a residence is therefore an owner's responsibility in every state of this country! 

The engineering company recommended "subsurface soils be improved to minimize further subsidence damage.

With uncertainty right now in the market, I don't see the lending landscape improving in the near future.

Your right it should have nothing to do with the 1031 but it it goes on the hud it is messy and easier for the service to claim you are receiving boot  A simple statement to that effect can go into the contract and the title company may even be willing to handle that part for you.Re: the excess funds- depending on valuations and any work needed on your replacement properties there may be a way to enfold that into improvements to tour replacements and still keep tax deferred status of that money

If you are a buy and hold type you will find many opportunities available; perform your due diligence as many houses require more construction efforts or cosmetic improvement than others.Hope this helps.  

Be sure you have an ownership interest (land contract or contract for deed) instead of a leasehold interest (lease with option to buy) before you put a significant amount of your funds into improving the property.    

Real estate has improved considerably from its darkest period of 2008/09 and likewise so has the work contractors find.