But strictly going by the numbers, it's borderline OK, depending on the type of market.

It creates over-leverage and the performance of one property is dependent on the other.

The home is in a C- to B neighborhood, depending on the person.

Ultimately, it depends on your goals (low rates, fast turnaround, etc.).

This might be better if you’re uncertain about refinancing or want to keep more liquidity for other opportunities.Since you’ll move in 5 years, it really depends on how confident you are about refinancing.

@Dorian Gray - I think part of the answer to your question depends on the likelihood of needing more funding in the future and if you have another plan to slowly build up reserve funding.

It depends on the lender.

It really depends on how many units you manage, where you are listing them, and what features you need/want. 

@Ash Gowda - typically a 1.3-1.35 dscr.  5/7/10 (all dependent upon the lease term and re-ups); Rates fluctuate but for now from low to high 6's fixed.

I think it really depends on if you are able to increase that cap rate with value-adds post acquisition.