If I make $100K on an RE this year, I do not care if the source of the  profit is cash flow, value add, appreciation, equity pay down, of I found a safe full of money buried in the basement. 

There's a lot of cash sitting out there in bank accounts, CDs, money markets, and safe deposit boxes looking for something to do.  

Finance your house, car, boat, motor home, carpet, furniture, jewelry, HeckI even saw an ad to finance a safe!

This should be based on the average of your market, but 8% is a safe, conservative number.A quick method for evaluating is to assume 50% of your income will go toward your percentage expenses and your utility expenses.

But  it has all the ingredients, great location, safe area, long term tenants, which I met and interviewed each one of them. 

@Keith Jourdan If you have a balloon due in 3 years, safe to assume that you'll refi prior to?

If the neighborhood does explode in value and trendiness, then your next upgrade is going to be exotic granite that looks great in photos, because one exit strategy is to sell it to an investor that lives fifteen states over as a safe-bet turnkey and plow the money back into the next up-and-coming Cleveland neighborhood. 

Remember, when you are providing a home for someone else to live in, it takes a great deal of responsiblity to ensure that they have a safe, secure and warm place to live 24/7.

Temples CHARGED interest for safe-guarding, they didn't pay interest for it - they loaned it just like Banks do, but I assure you the "qualification process" was a bit more stringent than even today.

But if you and your wife have the opportunity to create a safe, sound and F/C home for the part of your life when you are raising children (it's so short, trust me)...DO IT.Full disclosure: Parenting has been my best gig to date.