FHA to conventional on a rental unit?

[Michael McDermott]

I currently own a single family attached rental unit in the suburbs of Philadelphia. I bought the house using an FHA loan, the house was appraised at 125 in 2009 and I took out a loan of 117. Last September I turned this into a rental unit which I am making about 300 a month on and using part of that to pay down the principal. My equity is at about 15% right now. I would like to buy a duplex in the near future but cannot afford the down-payment of anything above 5% really, so my idea is to convert this FHA loan into a conventional loan so I can use the FHA loan again to purchase a duplex for me to live in and rent out the other half.

Does this idea make sense? Would anyone advise against this? Is there a better option that I am not exploring?

Thank You.