The IRS is specific that this rule applies if two conditions are met, it must be used for personal as a residence and rented less than 15 days. 

I'm living abroad in Germany but want to apply David Greene's long distance real estate investing strategies into buying my first property. 

But if I were to change the formula to apply it to your situation, it would be something like this:  If 24 months or less of gross rent would pay for the house, buy it. 

LMR (last month rent), if held in escrow, can be applied to the lease-breaking payment, that way the tenant only has to go out-of-pocket for 1 additional month's rent. 

You will need to apply for the appropriate permitting.

How would this apply for a mixed rental / primary residence?

So here's what you should do: apply for a zero-interest credit card and put the replacement A/C on it.

The only problem is though that I might not be for another 2 years or so before I can pull this money out of the rental to apply toward another investment and interest rates might be a good bit higher then?

Thank you everyone for the input, I spoke with my banker and the loan I am applying for is not a first time home buyers, it is a loan anyone can apply for.

If the taxpayer argues the short statute, your response would be that you have been in possession for three years, so the short statute does not apply as a bar.