Also, I'm not sure what other assets your parents own and the size of their estate, but there is a major change coming to estate tax laws in 2026, that depending on the size of their estate, gifting may be something to consider while the exemptions are high, which comes with its own sets of pros/cons.  

Purchase price: $170,000 We turned a gift from a family member into our first real estate investment.

, you may also want to consider estate planning and/or gift planning while we're in a high estate tax exemption environment before the sunset in 2026.As to the income tax planning, most of the time the tax "savings" come by way of depreciation. 

We did a step-up of the $3.1M to $5M and having the other $600k from the appraisal gifted to the syndication. 

That is basically gifting you money. 10% down is also way too low to make it attractive for a seller to finance you. 

Did a "hard money loan" with family using gift tax exemption and trust as collateral (despite what Dave Ramsey says, my father and I have an incredibly strong investing and personal relationship).

Nobody’s saying you have to use a 1031, but it is a large and powerful gift.

You win because you're not losing out on rent and still getting good tenants, the tenants win because they get discounts, and the community wins because the people were proud to live there and help out the local economy.If I ever decide to get into big apartment complex investing I'd probably do something similar to this rather than giving discounts on rent or gifts or anything like that.

I felt a fiduciary duty to respect the gift I was given (and the person who gave it to me).  

Somebody could gift it to a wholesaler or previous buyer for a dollar and if the property is worth millions dollars in ARV and you get it for 70% of ARV minus your repair costs, then you should pay for it what it's worth.