Part of the 1031 is you are NOT ALLOWED to take possession of the proceeds of your sale so you have to hire a company to act on your behalf, $$$ 2) You have a limited amount of time to identify and then close on the replacement property or else the initial sale becomes a taxable transaction. 3) Finding a replacement property in that timeframe may force you to overspend $$$ :-( on the next property(s) just to get in done. 4) The tax paid now is less then the associated costs of completing a 1031 and the possible cash out refi. 5) Fear of the unknown.If you want to create wealth for multi-generations you could 1031 all your small investments into one real large one (SFR and duplexes into an apartment complex) then when you pass your heirs will get the asset at its stepped up value (value on the date of your death) and could sell it at that price with no tax owed.

What happens if someone decides to leave the partnership or something unforseen happens to one of the partners (death, accident, illness)? 

We qualify to purchase the land right now as is and have no timeline to purchase as our right to first refusal is upon my Grandmas death which till then she pays the taxes and holds onto the property.  

If you waited, and inherited the house from your father at his death, your cost basis would be the fair market value of the house at the time of his death.

It's death by a thousand cuts...if you can, add a few days to that trip.

Death and taxes, they come for everyone. 

Your margin could disappear easily with interior damage.Despite the low inventory the comps make it appear that the market is still falling and in my area, a special assessment 2 years in a row would be the kiss of death for a condo.You have an owner who didn't even leave after the bank took it over so he might not be in the mood to give it to you in good shape.Also in my area, buying an REO puts you on the hook for up to 6 months back assessments, so you might check that out.

Welcome Josh.I would recommend you check out the podcasts as well as the tab in the toll bar titled "Learn".

Partial buyout 5 years of payments then I would resume payments.Seems risky as many things could happen here like death of note buyer, insurance claim, default.  

Now, here is a rough run-down of the type of motivated seller leads I got this last month from my website: 1 absentee owner, 2 divorces, 1 job loss, and 1 death in the family.