Keep in mind that you get to depreciate these appliances on your taxes.

How is it a tax strategy though?

A couple developers we work with skip LIHTC and the tax credits and go the route of impact funds to help alongside other debt and sometimes equity. 

so I used 1.5% as a property tax number, and I used $200 mo for insurance.

This creates two loan payments ($100,000 of equity and $300,000 on the new mortgage).Key NumbersHome Equity Loan Interest Rate: 6%Mortgage Interest Rate: 7%Rental Income: $3,000 per monthExpenses (management, taxes, insurance, maintenance): $800 per monthIncome and ExpensesMonthly Rental Income: $3,000Monthly Expenses: $800Monthly Mortgage Payment: $2,000ExplanationThe investor earns $3,000 in rent each month.They pay $2,000 on the investment property mortgage and $800 on other expenses.This leaves $200 profit each month or $2,400 per year.However, you have to pay $6,000 interest on the equity borrowed.This leaves you with an annual loss of $3,600.While the rental property generates positive monthly income, the interest cost of borrowing the initial $100,000 results in an overall loss.

BTW behind Texas.When all forms of taxes are calculated (income, property, and sales tax), CA ranks below the middle of the nation in total tax rate.  

How much money, after expenses and taxes would he property make yearly?

I have a confession: my only duplex, which I gave owned now for 2 years and recently moved out of from a house hack, has proven to cost me more to maintain/pay taxes/repair/fix etc to the point where my cash flow is close to zero.

So, in your considerations, I would park right there for a bit and determine how this would look for you.Since you have about 2.5 years to think about it before you would need to spring into action to take advantage of the rollover for tax advantages, maybe you try on a rental and see how it fits. 

3) Your $250k with 30% down => about $750k (you also need funds for closing costs, taxes, etc.)