Personally I want start out with a duplex, but probates have peaked my curiosity.

Trying to save money is one thing but you don't want to accrue a sunk investment and find yourself deep into a deal that needs more than saving.

In saying that, you've definitely come to the right place to explore your curiosity about REI and pull the trigger. 

Where does the accrued equity for the first year (begining) comes from and the appreciation?

From a tax perspective, downloading the scans of cancelled checks (which have a memo line that comes in very hand for recording the purpose of the expense) is easier than going through your LLC credit card statement each month and taking separate notes for each expense.You could use a CREDIT card providing you pay the balance in full each month, so as to never incur interest charges, but that exposes you to an unnecessary risk (or mistake if you forget to make a payment and thus accrue interest charges) that is easily obviated by using a DEBIT card instead.  

If "Gayle" had left those funds in her retirement that "50-60%" loss(which we both no is not a loss unless she sold her holdings" has long since recovered and even accrued a sizeable gain has it not ?

Johnny, out of curiosity what is the plan?  

Out of curiosity, what area codes are you focusing in on in Sacramento?  

By doing this you get the benefit of owner financing they can complete a fully deferred exchange and the note they continue to carry will accrue no tax on the principle part of the payments- only on the interest3 you mentioned a short term note.  

I've had a nagging curiosity about real estate investing for probably a decade now, but I just never felt stable enough to even think about getting started.