You have to live there 2 of the last 5 years to get the exemption from selling the property as a principal residence. It only has to be a rental right after you buy to finish off the 1031 exchange obligation.
I bought Al’s Goldmine several years ago. In the 1031 section he said can covert a 1031 to a residence. Best to do this over 2 tax years. But how do you report such a conversion? Or just let it go until IRS asks questions? I have a 1031 property bought in 06 that I want to convert.