However, after meeting with a friend who has real estate experience he mentioned that he predicts in about 12-18 months there will be a downturn of the market and an influx of foreclosures due to the pandemic forebearance.I now feel like our momentum and excitement has come to a screeching halt and I am unsure of whether or not to invest in this market.I understand long term the market works itself out, however, if I bought this multifamily unit on my current income, I cannot afford for the rental market to depreciate as well which is my fear.The mortgage would be about 4K.

I only WISH I had known about this ability to make money earn in two places at once while ALSO getting a death benefit and future tax benefits.

Our taxable earned income from our employment will be approximately $85,000. 

Not like it's vacant and you have no income on it.

What I also did though was give the borrower a PFS and information that showed I could pay this loan and had the ability to pay the loan whether it was generating income or generating no income. 

If I didn't want any more rentals (or had no more borrowing power as I was maxed out), I'd still probably save that money as I can earn more off interest in a savings account than I'd save in interest as my mortgages currently have low interest rates. 

I've also had one potential tenant tell me that "an income requirement of 3x the monthly rent basically disqualifies single-income families".

Previously loan officers have not been very optimistic, probably due to her income. 

If not, factor minimum 15% for management.Also, consider that you will pay taxes on all the income (after expenses).As others mentioned, research the competition in your area to learn the demand/restrictions.Depending on these answers, you may be better off doing this closer to home. 

If you want to use your income to underwrite the loan then you will have a longer seasoning / waiting period as those loans have different rules compared to loans underwritten by the rents / DSCR loans.