Getting started with an onsite rental and one additional

[Matthew Hall]

My wife and I currently own a 2 bedroom/1 bath house in a nice neighborhood, but we bought just before the crash and have only just broken even on it seven and a half years later.  Our interest rate is 6.125% (no equity to refinance) and taxes are high ($7600/year) so our payment is relatively steep at $2315/mo.  The most we could rent it for given the current market would be $2000.  It is within walking distance of a train to NYC, a walkable downtown, has a fenced backyard, schools are good, etc...  

I just got a new job with a $20K bump in salary that would allow us to buy a $300K property and retain our current property with an FHA loan given their DTI limits. That said, I've got my eye on a property that needs rehab work, but I think could get it for $200K, then use a 203K loan to purchase it and dump another $100K into it. The property has a very nice detached carriage house garage with a studio apartment on top. I could easily get $1500 a month for it as it close to both a trendy downtown area with lots of shops, bars, and restaurants, as well as the state capital. All in all, if works out, I could cover the mortgage on our current house plus have a little to spare. I figure down the road I could decide to keep it and refinance or sell it and just keep the rental income from the onsite studio apartment.

I'd love to hear any potential pitfalls, or advice from others with more experience.  It's my hope that I can start with the two rentals and begin to expand from there.