I don't think so, but I would check with an accountant to make sure. You will probably also want to consult with an attorney to draw up a proper lease.
Some may say that this is totally avoiding taxes, but it isn't. When you go to sell the property, your cost basis will be less and therefore you will potentially have to pay more taxes then if you had bought it at the market rate.
Initially, this looks like a far better deal for you than the sellers. Why would they agree to such a thing? Also weird situations like this are created for a reason, often times unwholesome. What happens if the property taxes or insurance increase dramatically? Does that make this a good deal? Maybe the property needs extensive renovations (like an HVAC) and this is their way of getting you to pay for it.
If this was a short term thing, I would be fine with it, but three years make it seem like a con in the making. Taking the "free rent for a discount" thing out of the picture, would you want to own this property as an investment? Often times the answer to that is "no" which gives you a reason to walk away. In the case that it is "yes" why not do a more conventional deal?
Having had some experience with this lately, there could be some issues if the sellers declare bankruptcy. If they sell you something at below market value you could be forced to repay the difference and then you would a creditor like anyone else.
If you have that much extra cash, to forego income on an investment property for three years, there are probably much better deals to be had.
It is somewhat common for owners to sell a house and then rent it back from the buyer for a few months. Most often this coincides with the end of the school year, so kids are not uprooted in the middle of a school year. Typically the transactions are atomic, the house is sold at market rate, and the rent and lease is at market rate.