That is another factor that a bank will consider. 

The precise property forecast can vary depending on a lot of factors but the general demand is really what you should use the tool for to make your plans. 

You will also have to factor in the closing cost for the new loan.

Property Valuation:Investors look at a variety of factors to determine a property’s value, including comparable sales (comps), rental income potential, and location.

Heck, some people might even pay more for the 'cool factor' of living in a 'small home'....I'd give it a go since you're a veteran of this RE stuff.

Vacancy and maintenance factors should be higher than for Class A or B.

@Stuart UdisAll great comments, seems like putting skin in the game will be a reassuring factor for any potential investors.

Here's a link https://www.oregon.gov/ODA/shared/Documents/Publications/FoodSafety/ServiceAnimalsposter.pdf The BS factor is off the charts with some clients...Then it gets tricky because you are only allowed to ask certain questions as to whether the dog has been trained to perform a specific task etc.

Like everything else... if the numbers work and all the other factors at play are good in your opinion.... go for it! 

An audit could be triggered by a number of factors that don't line up when run through the IRS's system, and create an exception.