Even with smaller appreciation you would see some equity growth on the pay-down of your loan, rather than spending it all on rent.... as an agent in western Washington I have given the same advice to a few buyers who were struggling with the competitive market, but realizing they were sick of paying rent....

Just realize that this unit is at higher risk of not meeting pro forma projections.  

Hey guys, I posted once before and realized I never gave a formal introduction.

The losses realized by investors are in the hundreds of millions.  

As long as you have the $$ (outside of the HELOC) for 20-25% down, you can keep on buying houses, cash, with this strategy.As you've already realized, you biggest roadblock here will likely be just finding a decent deal here in Atlanta.

BUT I just realized that once you take the equity out you will now have a higher mortgage payment and basically erase all the progress you've made on paying off that property... unless I'm missing something?

I dropped them immediately and just replaced it realizing by the time I kept paying service fees I and premiums I could have had a new system. 

When I dug in, I realized that they had mistakenly added the debt but had added zero income back from the property! 

I misunderstood, I thought this was originally a flip then decided to keep to hold and rent, I did not realize you intended to keep as a primary residence in which case the info from Jay and others is correct, you cant get any depreciation on your primary residence, only investment properties. 

However, I also realized that I really did not give it much effort.