Let's you and the fam live as a group in the main house with a portion of costs covered by that rental door over the garage for now.

It may not work for you but I found giving my partner ownership of a certain portion of the operation was helpful.

Your rental income will be taxable and here are some expenses you would be able to deduct on the rental portion of the property.  

He can finance your "down payment" in the form of a 2nd mortgage as long as he and/or his trust partners are willing to accept a portion of their proceeds in the form of monthly payments after the sale. 

Knowledge of property cycles and of neighbourhood/city growth is essential to be able to predict it with the degree of accuracy that you would want if this was your property diversification portion of your portfolio.Broadly speaking rejuvenation projects, that is developing property that is in severe decline to increase the Usage Value ( an industry standard term to quantify the maximum possible return on your investment that a land parcel could yield in a given market given it's zoning) is normally the most lucrative type of appreciation category.

You are also free to keep some of the cash out of the 1031 and just pay taxes on that portion you keep out.

If you purchased last year, and immediately began marketing the property for rental use, then the property was in service as a rental for a portion of the year last year. 

Also, depending on the day of the month you close the deal, you will be credited a pro-rata portion of the rent, the security deposit and, depending on when in the year you close, you will also get prorated property taxes.

I'm concerned with what could happen to that portion of land.

DFW is more laid back, but San Antonio, Austin, portions of DFW (depends on County), will reassess you aggressively after purchase.