At this point my partner's equity would get a little smaller each month compared to mine as I put all my profits towards the faster pay down but they would still be making enough to live comfortably until the 1st property was completely payed off in year 10 and cash flow increased from ~$120k to ~$228k.

The HA will then determine if they can pay your rent based on it being reasonible compared to other comparible non-sec 8 rentals and affordable for this particular voucher holder.  

Account ClosedIncome taxes are normally not calculated in cash-on-cash return calculations because everyone's tax situation is different.For sake of comparison - the cash-on-cash return should be comparable on a level playing field.Person A - $100 return on a $1000 investment.

A in-law suite is not a legal rental so the appraisals are not comparable.

Want to sell it and buy other house with traditional financing.

Lenders have different lending terms and conditions compared to their competition.

Without the borrower willing to participate in a short sale, you have No chance of getting a reduced pay off, assuming this is a traditional lender/mtg.

This isn't bad compared to a lot of schools, but was still more than we wanted to pay. 

The same is true for the economy, we are growing but compared to similar cities we are falling behind (if you don’t read the Chung Report, I’d start subscribing to it).   

For a flip property, you're going to want to find a hard money lender or private money partner since traditional banks shy away from loans for such properties.