Remember, a refinance involves more finance costs as well.On cash flow projections, the CapEx and expenditures are low.

Net annual cashflow after cashing out equals x% of your acquisition cost plus capital expenditures. 

What I need help with is evaluating the property with regards to future expenditures - capital or otherwise and forced value.I have no experience in evaluating a house let alone an apartment complex. 

You need to take into account any future capital expenditures (capex) that it will need (roof/water heater/furnace). 

You can essentially "Save" rent you would pay anywhere else, and instead get money (in form of principal repayment) from the tenant. few other thing you need to consider though is vacancy rate, property tax, capital expenditures, and if you would need to use property management firms (unless you have the time to find new tenants, deal with their complaints, etc.). 

6) I would add in CAPEX (capital expenditures).

Depending on your expenditure amount to spend would effect your way to go. 

.: "A taxpayer may claim a credit of 30% of qualified expenditures for a system that serves a dwelling unit located in the United States that is owned and used as a residence by the taxpayer."

.: "A taxpayer may claim a credit of 30% of qualified expenditures for a system that serves a dwelling unit located in the United States that is owned and used as a residence by the taxpayer."

In other words, not quite the 1% rule, but hopefully little capital expenditures for a while.