We're exploring creative ways to provide him with the cash needed for the down payment while avoiding triggering a taxable event.One strategy we're considering is purchasing his future primary residence ourselves, making the mortgage payments, and then, once we've built enough equity—comparable to the appraised value of his rental properties—transferring the title to him as a form of exchange.What are your thoughts on this approach?

there you go. the problem is appraisal. comparable sales, and your approach to building an ADU against the recommendation of your market. super beginner strategy it's popular in ohio as well but just not worth the investment. 

We recommend you get management contracts from several PMCs and compare the services they cover and, more importantly, what they each DO NOT cover.

A carryover basis would be a huge downside though compared to a basis step-up if held by parents until death. 

We certainly have found some deals that would reduce our living expenses compared to renting.

Examples might include areas in the Midwest, Southeast, or Sunbelt regions.Multifamily Properties: Consider duplexes, triplexes, or small apartment buildings to increase unit count and spread risk across multiple tenants.Short-Term Rentals: If you’re comfortable with the management requirements, STRs in vacation or business travel markets can offer significantly higher cash flow potential than traditional rentals.Value-Add Properties: Look for opportunities to buy undervalued properties where you can force appreciation through renovations or better management.Decision FrameworkRun the Numbers: Compare the projected cash flow, equity growth, and tax implications of selling versus holding with a refinance or HELOC.

Comparable property sales do not affect the depreciation basis, which is determined by actual purchase and improvement costs.

Very common to have structural issues caused by soil movement. 

Owning the multifamily has it's challenges as everyone knows when you compare NNN to multifamily.

Dustin, you're comparing apples and pears.