I recommend you do this each year to adjust for utility increases and other variables.

Lots of variables to consider.

HELOC works like a large credit card with a variable rate and usually baloon payment schedule.

But you also want to ask yourself how much debt are you comfortable with...which will be affected by various other things, like how close you are to retirement, etc.Sure, DTI could certainly be another variable in your analysis, but in and of itself, I don't see that being the end-all, be-all unless you are in a really bad state from that perspective.

Really there is only one variable, (I'm probably going to get hammered for this) the capitalization rate.

For taxpayers in the 25% - 35% bracket the rate is 15%For taxpayers in the 39% bracket the rate is 20%For most capital gains the net investment income tax of 3.8% kicks in on the lesser of the capital gain or the excess of their AGI over $250k (married) and $200k (single).For example, $1 million capital gain, married filing joint, no other income: Capital gain up to $75k (roughly) taxed at 0% Capital gain of $390k (roughly the 25% - %35% bracket range) taxed at 15% = $58,500 Capital gain of $535 taxed at 20% = $107,000 Net Investment Income Tax ($750k @ 3.8%) = $28,500 Total Tax = $194,000 Plus state taxThere are other variables but this is the basic idea.

That was enough for me to want to switch to long term, and now we have a new variable of covid into it, I personally would not like to do airbnb.

Obviously there are a lot of variables but for a casita your looking at less than 25k.

There are a lot of variables to consider in this question.    

One variable that has been problematic when searching for properties is the amount of parking available.