Accounting for living in a rental property

[Leah Gaspard]

I'm considering a property that's marketed as a 2 family with 3 bedrooms and 1 bath upstairs, and what is actually a 1 bedroom apartment on the first floor (there is a finished basement, but can't be utilized as a living space if that makes sense). 

When I enter estimated potential rental income for the top floor (2000) and 1st floor (1700) and a garage space I can rent for storage (100) my cash-on-cash percentage is in the negative (about 11%) and monthly cashflow is -$100.00. Since I'm not putting 20% down, I would be paying PMI with a conventional loan.

However, should I consider that if I plan to live in the top for unit and rent the 1st floor for 1700, after several years (assuming 2% increase in property value/rent) I should be able to hold the property without a loss, and have my tenants help me pay the mortgage. 

I am a newbie obviously, and want to know if I'm thinking about this the right way. Should I like to forecast my c.o.c return or is that too risky?