I feel that it is in a good enough neighborhood that worst case scenario I could still rent it for my anticipated mortgage pmt and take a small hit each month until the recovery happens.

If it's already a good enough deal it will be snapped up anyway; I have some buyer clients that have been procrastinating with that same thought recently regarding places in Oakland and are now upset that the properties are already pending even though they just went on the market last week.

Am I over leveraging on this deal that may not be good enough with the current unknowns in the market?

If you can't explain it to someone, it's not good enough. 

In my market the worst areas are not good enough for section 8. 

Heck if the numbers are good enough I'd buy both.

Apparently it’s still not good enough.  

Lots can change in that time and I'm guessing you have a good enough rapport with your tenants that they know they can contact you if there are problems.

My mortgage would be $280,000 and it would cash flow about $200 per month.I guess my concerns are just the bones of the house holding up long term but when I tore everything apart they seemed in good enough shape to keep in place even though they’re from the 50s.

Just trying to see what my options are and if it sounds good enough, build a little team.