With every additional unit, you slightly reduce your tenant risk and find that valuations are better on larger assets.

You get a 15% reduction on the original investment and all capital gains made from the QOF are Tax-free.

Our family has been renting a single-family home (see description/additional background below) for the last 2 years and are considering buying the property from the landlord via private sale.

Our goal is to add an additional 25-35 in the next 5 years.

In addition, once you've freed up your equity in your current home and invested it in income-producing real estate assets, consider applying for a couple of FHA multi-family property loans (4 units or lease) which have competitive rates and low down-payments (3.75% at the time of writing this). 

Speak to your banking representative and they can give you some additional options.

that way you can figure out what the  upside is in addition to cash flow.good luck!

Seeking reduction of liability eventually with all homes in LLCS when rates are better for commercial loans or we BRRR these homes.

@AJ Dhillon In addition to what's already been mentioned.

The other thing to keep in mind is to be very careful with the owner staying for six additional months.