Taking a look at the last 5 years alone shows an increase in property values.

You can make it clear to the tenants that they will be held responsible for excess damage or waste caused by the animal,  just as if they themselves did it.While you need to be careful to avoid a claim of retailation,   maybe schedule the next couple rent increases to be a couple percent more than you otherwise would,  and bank those funds towards expected greater turnover costs.  

Rising market indicators are properties increasing in value, days on the market are shortening, multiple offer situations, and/or a tightening supply of houses.

The HOA fees scare the heck out of me because they can increase at a moments notice

I would even do 6 or 12 month rentals to give yourself room to reevaluated the market and increase the rent.I would then draw on the HELOC which your tenant will cover from your premium rent.I would use the HELOC as leverage as a down payment to a large multi-unit. 

I intend to increase the rent to market rate, but I would like to do that gradually.

I offer the small pricing tweaks and info for your consideration.I would increase your property tax estimate to 1.25%.  

WAAAAAAY more affordable.http://ktar.com/story/1908091/could-downtown-phoenix-be-the-next-major-hub-for-high-tech-companies/"Shannon Selby, the economic development program manager for the City of Phoenix, said the number of high-tech companies in the area has increased from 67 to 281 over the last five years, a growth of more than 300 percent."

Silicone valley obviously increased a lot already in last 5 years, and it should be one of the most expensive city in among the US.

Signs of slowing due to increased inventory, but still double digit growth/appreciation continued for remainder of year.You will get good cashflow in midwest, but limited appreciation.I'm vested in southern California and Las Vegas.