Questions about to 1-2% test

[Dave R Ludolph]

I feel like the easiest way to explain this is with an example. Say I buy a property for $60k and put in $40k in improvements with a total investment of $100k. I then rent the house out for $1000 a month which would meet the 1% rule. So say I now want to cash out refinance to brrr and they value the house at $120k (I'm really good at renovations lol), would I then increase rent to $1200 a month to stay in 1% or since I'm investing the extra financing into another property do I not worry about it? Thanks ahead!