@Brian Adzadi the 'house hack' method isn't an option for me unfortunately due to a few factors (beyond the terrible market for rentals where I live).

I haven’t factored in city permit costs.

We are just speculating on the upward moving of this market because the house price keeps rising and there are organic factors that support it so in a moment we think negative cash flow can gradually be covered by picked up rising rental rate, but i guess its not financially sound on this deal

Gallinelli's advice about considering the time value of money seemed like a very important factor in determining the overall potential for earning a profit on an investment and I really wanted to understand how to figure that out.

I was told yesterday by a lender that we would have issues being approved for a loan mainly for this reason.

Even if it appreciates down the line, you will have to factor in capital gains tax to see if it’s really worth it.  

@Adam Hale based on those numbers the 1% rule applies so it seems alright, but there are other factors you have not mentioned that are critical. 

Could be a number of different factors, but I have'nt seen price drops in this area for years, so I've taken notice. 

If you go month to month they tend to factor that in and may not like that .

Mainly, the systems implemented are fascinating (VA, automated offers, etc.)