But considering the way he does it sounds like a great way to reduce risk.

However, by doing so, I'll be paying $1000 extra each year towards my mortgage, reducing my cashflow to $4000/year.

When you do a cash out refinance its cash in hand (liquid reserve) so it can be used as an asset or for PITI reserves on the next purchase.The other downfall is if your credit score should drop for any reason which can happen even my accident or mistake the lender will close or reduce the Heloc credit limit.

Someone said it before but definitely drop price when starting and even say in your listing your new and reduced price so people will try it!

Then we reduce once or twice or notice issues with the listing. 

I initially listed the property for rent at $1100 but had to reduce it to $1000.

I'm Grant and I'm looking to house hack a duplex with the goal of reducing my family's expenses.

When we finally move to SD permanently  I plan to refinance, pay it down and reduce the loan.Does this seem like a reasonable plan or should I allow the 3% rate to lock me into that rental even though I want to use that equity to buy in SD rather than wait several more years, till I save up more for a down payment to buy in SD?

The resolution of the photo was reduced so the contrast is not showing like it does in the original photos.  

No time for a full lesson on this, sorry, but the point is: it does not necessarily reduce your taxes.If it does, it's not dollar-for-dollar.