Need I be concerned with UBTI?  

The concern here is the financing.

hopefully your inspection went well. wish i would have seen your post earlier i would have been happy to help you out with your inspection. but to answer your question, there really isn't anything you need to "ask" your inspector to look for. if he is a good inspector he will know what to look for and what defects are major and should be addressed immediately and which defects are minor.

I have sold some properties years ago on lease options where the tenant buyers actually exercise their right and purchased the property. ( I was in the deed.)The reason I am concerned to tie another person’s property up  with the lease option is that people can change their mind, as in the seller.  

Stabilizing inflation could create more predictable home prices and rental yields, but affordability challenges—especially in urban markets—remain a concern.

However, very glad that we pivoted to mid-term rental approach around $4,500 to $5,000 that has helped address vacancy.

Think of all the things that could go wrong and see if the lease addresses them: unauthorized pets or tenants, early termination, security deposit, lease violations, late rent, eviction, lawn maintenance, parking, etc.5.

It's mostly Class A properties, a few Class B.You may find the below copy & paste info useful in addressing your question:----------------------------------------------------------------------------------Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a property in Class D area to Class A standards, what quality of tenant will you get?

These items have me slightly concerned and weighs on my decision, making me want to "take the money and run".Question: Would you sell, abandoning a 3.125% interest rate, $1000/mo cashflow (which I believe would be roughly halved if a loan were taken for the capital improvements to the larger property), to lock in the equity gains tax-free made since 2020?

Why even concern yourself with the legality if it’s self serving and harmful to your family member?