Also, the fees plus being a forced buyer with a deadline on a 1031 exchange may negate the small tax savings.

You’re not buying ownership, but you’re securing a share of the cash flow, which can be appealing for passive investors.For property owners, the trade-off is receiving immediate liquidity in exchange for sharing future cash flow.

You could leverage the value of the entire four plex to put towards a larger asset or try to 1031 exchange it. again, i am no expert but I would consider myself a fairly savvy investor.

Quote from @Ian Ippolito: Quote from @Michael Plaks: Quote from @Ian Ippolito: Quote from @Rud Sev: 3) Unless you're doing a 1031 exchange  at the end or similar tax structure to defer taxes, you will have to *pay back* all that depreciation benefit at the end (on sale...which for you is in 5 years)  via depreciation recapture.

You are a high w2 earner, The house is worth 110k today, you are buying from your grandma for 60k in exchange for free rent for life, upside ARV of 200k.The costs of owning the house will help provide tax relief on your high w2 earnings, you are buying a great chunk of equity that will pay off in the future, and you and your grandma are doing each other solids. 

A friend of mine invested in one last year—apartments upstairs, a small coffee shop downstairs - and the combination of income streams made it a steady performer.Scaling with a 1031 Exchange:While not applicable unless you sell a property, planning for a 1031 exchange could help you scale quickly while avoiding capital gains taxes.

You don’t kill your whole exchange.

Bought a place a few months ago on market while doing a 1031 exchange..

You will have to 1031 exchange.

One thing I'll add to an off-market deal is you might find a seller willing to do seller financing.You said, "I don't think the time exchanged to manage SFH would be worth my time and the cash flow most likely wouldn't be reasonable enough to hire a property manager.