CoC Returns and Loan Amount Question

[David Dunne]

Curious what others think about how to account for the total loan amount when factoring in a buy/ no-buy decision for a rental property in addition to the CoC returns. The concern is the high debt and impacts to my overall ability to acquire future properties in the near future.

I am considering the purchase of a rental unit via a 0% down VA loan (clearly I would occupy for 1 year). The closing costs going in would total ~11k on the 280k loan. The (great condition) unit is located in Guam, and due to the demand of this particular unit (11 story beach view), the lack of supply, and steady demand, I forecast a continued rental income of 2250/ month on 1,975/ month expense with ease. ~275/ month after Mgmt fees and 11k down is a 30% CoC return. Not bad. But a 280k loan on my books would hinder my ability to acquire other properties for some time. Ideally, I'd like to have 2 properties within the next year.

There are other, lower-priced rentals around which would enable this, but much higher upfront costs with rehab required to attract tenants. 

Thoughts on how others would approach this are appreciated.