I agree with @Ricky Beliveau - there are better investment opportunities out there. I never advise to bank on appreciation because while areas like Southie/Seaport don't seem to be letting up anytime soon, it's still a gamble. I would look for something that has better numbers NOW, and then once it appreciates it is all the more sweeter.
That being said, @Zack Karp made a good point. If you are confident in the appreciation after a year, you can refinance into a conventional loan and even at less than 80% LTV you will have PMI but it will be pretty minimal and will automatically drop off once you hit 22% equity (unless you feel you have 20% equity and you can request another appraisal, but appraisals aren't free either). I did something similar myself and purchased a SF for my primary residence with 5% down, a year later the market is up and I made several improvements so I will be getting an appraisal to drop the PMI.
