You may need to look into tapping into the equity of any rentals you own or just funding this all cash. 

In @Rick Albert numbers starting with a negative $110 equity position consumes years of cash flow.  

But I'd like to be positioned to continue investing in vacation rentals if we can build a good team and process around the first one.

My concern is I tend to be less risk adverse especially with short term losses if the long term gain is worthwhile (i.e maybe the property might not cash flow today but it gains more equity).

But the official position of the IRS is different. 

If i have propertie now that rent for section 8 can i Heloc my equity i have in my property? 

I know the amount of cashflows isnt always going to be the same but i would if their is a positive, i would like to use the funds to pay back the loanor could i set up a checking account with automatic payment to the 401k loan from the left over cashflow deposited from the leases ?

I would ask that you try to represent my position fairly before criticizing it. 

:Class A Properties:Cashflow vs Appreciation: Typically, 3-5 years for positive cashflow, but you get highest relative rent & value appreciation.Vacancy Est: Historically 10%, 5% the more recent norm.Tenant Pool: Majority will have FICO scores of 680+, zero evictions in last 7 years.Class B Properties:Cashflow vs Appreciation: Typically, decent amount of relative rent & value appreciation.Vacancy Est: Historically 10%, 5% should be applied only if proper research done to support.Tenant Pool: Majority will have FICO scores of 620-680, some blemishes, but should have no evictions in last 5 yearsClass C Properties:Cashflow vs Appreciation: Typically, high cashflow and at the lower end of relative rent & value appreciation.

As we know they were so used to Negative Gearing that to buy a prop that had positive Gear of 10 to 20%  on paper they went for the 20 every single time.