I'd underwrite the property, with that low interest rate assumable mortgage, to cash flow positively from day 1 as a long-term rental, but be willing and able to use the rent by the room strategy or to rent out part of the property as a Short Term Rental to dramatically increase cash flow during my occupancy. 

The other thing that concerns me is you mention that you are both high income earners but that you are “trying” to save an emergency fund.

This will increase the return above what can be obtained on a passive investment.The flipside of having the power to control everything is that it can be alot of work (and a full-time job if a person is putting in sweat equity).

If your property's value has increased since you bought it... given the market trends in Albany, that's quite possible... you could tap into that equity sooner than you might think.

Other areas of concern are wetlands, flood plains, endangered species, archtectural and historic significance. 

Based on that, do you anticipate increasing or decreasing your investments?

This is where your focus should be, not buying section 8 rentals or focusing solely on increasing your portfolio by 2x, 3x etc.

They have increased in value, and our rents have increased by more than 45% overall.

As the tax code is concerned all of the costs to create your rental property business (buying it and making it usable for it's intended use) and one in the same. 

The shorter the prepayment term has an impact on increasing the rate.4.