Stuck on buying second rental property - MA (Very little experience on this)

[Samuel E.]

Hi All, 

So currently have a rental property, which is in a different state than where I currently live, where i have enough equity to buy a multi-family home which after calculating should give me enough for 20% on a 450k so I don't have PMI. I'm stuck deciding what would be the best way going about it, I was leaning towards a HELOC because I read you don't get taxed on the equity and can roll over towards a rental property for down payment. I know i can do a refinance and take the cash out but would get taxed on it but would hate for my mortgage rate to changes as its very low right now. I was wondering for those that been doing this for a while, would doing a HELOC be the best move?

Any issues I should be on the lookout with a HELOC? would it be a bad move to do giving the housing economy? Any guidance highly appreciated