Imagine making millions of dollars over the course of your career and then having to pay 30-50% every year to uncle sam instead of compounding that cash over time.This is exactly what real estate professionals have learned to mitigate.To reduce their taxable income, they just buy a building every year, do a cost seg, and use depreciation to reduce their tax liability dramatically.Their personal wealth snowball grows much larger and much faster than their W2 counterparts who give most of their money back to the government each year.Following this strategy as a real estate professional is one of best ways to end up with a much larger net worth at the end of your career.

We are paying cash to him every week or so when he sends bill. 

Quote from @Jeffrey Duck: I see no reason to pay an attorney for this, but it's your dime.The current lease was between you and Person B.

The hang up is getting deals formally drawn up.One idea:- I buy the property and pay 25% DP, then they provide capital after the closing and I pay them P&I over 5-10 years.

Now, you need to figure out how to find deals and pay for them.

You might not cash flow right away, but even just offsetting what you were paying in rent while building equity, getting tax benefits, and learning how to be a landlord is a game changer.

Less RiskWith traditional rentals, if your one tenant fails to pay, you’re in trouble.

Likely the cheapest option is to use a HELOC and with the new rent pay off that equity. 

Our tenants pay $2,700 in rent and the mortgage+fees comes out to $2,360.

Regarding your other questions:  - If the going value is $260/SF, why would you pay more than that?