To be clear, the area should sustain 85-100% occupancy for STR (like my friend sees with his units), as it is in high demand, and has a limited supply.

I am supplying the bank with my information for the HELOC; W2, tax information, pay stubs etc.

I'd be getting a killer deal on the fence due to having left over materials from another construction project at my parents property (they're letting me use their extra mat.) but it will still cost me at least $500 in extra lumber/supplies/labor but is it worth this? 

You get a submeter installed just before the supply wire to the electric panel of the second dwelling .

Houston Real Estate Highlights in March Single-family home sales rose 4.9 percent year-over-year, with 7,072 units sold, marking the second consecutive month of positive sales;Days on Market (DOM) for single-family homes remained unchanged at 64;Total property sales increased 3.6 percent, with 8,475 units sold;Total dollar volume jumped 5.7 percent to $2.4 billion;The single-family home median price rose 2.1 percent to $240,000, achieving a March high;The single-family home average price was up 2.0 percent to a March high of $298,766;Single-family homes months of inventory was at a 3.9-months supply, up from 3.3 months last March and at its most plentiful level since October 2018.

It is much needed supply, but how much is too much?

Now, watch closely as I do a 360 twist combo and buy/live for free in DFW Texas where duplexes are in short supply and high demand.

Then you add the strategic military location on top of being a world famous tourist location and you got a never ending supply of transient population for rentals and high demand for investors or rich retirees.

The 1% rule doesn't dictate your returns, especially in a stronger appreciation market. 

pid=1612Houston Real Estate Highlights in March Single-family home sales rose 4.9 percent year-over-year, with 7,072 units sold, marking the second consecutive month of positive sales;Days on Market (DOM) for single-family homes remained unchanged at 64;Total property sales increased 3.6 percent, with 8,475 units sold;Total dollar volume jumped 5.7 percent to $2.4 billion;The single-family home median price rose 2.1 percent to $240,000, achieving a March high;The single-family home average price was up 2.0 percent to a March high of $298,766;Single-family homes months of inventory was at a 3.9-months supply, up from 3.3 months last March and at its most plentiful level since October 2018.