Question regarding off-market seller that would like to 1031

[Grant Boney]

I am looking at purchasing an investment property and have found a potential lead off-market.  Unit is currently empty, owner was originally thinking about renting but is interested in selling after I contacted him.  His ultimate goal would be to 1031 exchange this property for another investment property.  If he does sell, he does not want to lock into another tenant.  This is not an owner occupied unit and he lives out of town.  

Current Rent: ~$1k/month

Current Comps sold w/ in last 3 months:  115K

Expenses (HOA, Insurance, Taxes): ~$235/month

From records, purchase price was ~1/3 current estimated home value ~4/5 years ago

I do not know what his current mortgage is or how much equity he has paid off.  

I am wondering what the best approach would be for this seller?  Would this be a good win-win for a lease with the option to buy scenario?  

-Offer to put $5k down, that would go towards the purchase of the house.  

-Negotiate the lease price so I could rent it to another tenant at a higher price for cash flow

-Negotiate final sale price

-When he finds suitable exchange property, we seal the deal 

-Negotiate a lease time frame - 12-24 months?

The benefit to me:

-Potential cashflow w/ minimal investment

-Ability to potentially negotiate lower selling price

Benefit to Seller:

-Ability to find appropriate 1031 property and not be rushed by 1031 timeline requirements

-Peace of mind that mortgage will be paid and he can sell whenever

Questions:

How would I calculate the correct lease price?  Just fair market rent?

Could/should any of that lease amount go towards the purchase as credit?

-Are there any other questions I should ask seller to see if I can help?

-Any other pros/cons?