I've searched a few terms, to try to get a better understanding of all this and how to better understand my numbers and to calculate things appropriately.

The logistics of doing quick tenant screening, finding an appropriate property management company, and coordinating storing my household goods with my date of departure with the move-in date of a prospective tenant, etc. aside, I also have to let this tenant know how long they'll rent my house for. 

Just tell him your expenses have increased, assuming that is why you want to increase rent, and give him the appropriate notice.Check your local laws and your lease as to how much notice you have to give and if there are limits on how much you can increase the rent by.

Once we are aware of the real issue at that time we dispatch the appropriate vendor to resolve the issue. 

Just getting into your local government office(s) and chatting with the appropriate personnel should help a lot with moving forward.If public water/sewer is available that should help.

You have to make sure that your house is appropriate for senior living, including widened accessible doors, ADA bathroom if required, walk in showers...etc.  You may be able to convince one of them to have a profit share model.

That's the appropriate way. 

I also agree with the 1031 exchange if appropriate.

@Daniel Choi, I don't think a 1031 is going to be appropriate for you on this property. 

If I'm thinking long term and have the appropriate funds for either, should I do 3 BR?