We are considering the following options:-I purchase the property from my aunt – Perhaps we can do seller financing to reduce fees?

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.

From a tax perspective, keeping the properties separate may allow step-up in basis benefits for your spouse upon inheritance, reducing capital gains taxes.

Yes, this is an unsexy option and it doesn't offer the same tax benefits, but you would benefit from reduced volatility (so long as you don't obsess over fluctuating stock prices), greater liquidity, stronger management teams and superior assets.

Due to recent building code changes, you can build a framed building up to 4 stories on a slab, which significantly reduces the overall cost of new construction.

On the REIT side - When these investments go underwater, often the sponsor company will freeze or drastically reduce redemptions.

This could reduce your taxable income in those years.Your decision depends on your long-term strategy.

This takes a little more work, but it's the fairest and reduces the likelihood of tenants that squander utilities.If you choose #2 or #3, there are considerations:Start with an average.

My wife and I have business income and our accountant can divide the income according to what would be the best for reducing tax liability.  

**As investors, you are closest to the consumer (home buyers/renters), so you tend to absorb costs and reduced profits from unexpected spikes in expenses that wholesalers or contractors pass on to you!