I do have a 9 to 5 making six figures, and all four of my rental properties are cash flowing, so I'm not sure why I keep hitting all these roadblocks. 

That contrast makes things really pop.

Which of the two options make you more uncomfortable?

If you could find a duplex property (or a single family house that could be turned into a duplex--check any HOA restrictions first), or a "fixer upper" to live in, that could be a better use of the equity you have in the rental house.If you run the numbers and decide it makes sense to sell the rental house (check with your accountant, figure out closing costs to selling and buying) then you'll possibly have more money to put towards a primary residence.You may want to check the neighborhoods that fall in the school district you want to stay in and look in "under appreciated" areas...maybe not the A class neighborhoods, but ones that have potential of becoming "improved".While I understand your desire to stay in a particular school district, it's not the end of the world to consider other districts if they will allow you to build real estate/family wealth that will put your entire family tree in a better position."

Makes no sense.

Also the deal has to make sense and the numbers work.

What should make ready cost? 

The question you should ask is how much money I will make if I invest $25K in this deal. 

Once you do have money saved go the hard money route, they make it easier to get into.

Most of the time a condo/townhome won't be the right fit due to condo fees, hoa fees, etc that make it more costly for the ownership but also more management intensive.