If you have a property manager a single layer of LLC protection will probably be sufficient. 

Are they shopping for a home, looking for a larger unit ...use that information to assess the amount of the increase.You will have a better idea if there will be increased risk on your part if there will not be sufficient time to market the unit and clean/prep or a new tenant.  

This is known as the self-sufficiency rule.

If there is sufficient equity, many 2nd mortgage lenders are perfectly OK with this.

Does it have sufficient equity based on your intentions?

I will be doing a no money down VA loan but not sure if 5% property value increase per year will be sufficient given only 3 years.

Having a good rent roll and spreadsheet should be sufficient.

Also, LLCs must be sufficiently captalized (but not "rich" enough to attract lawsuits) depending on the operating requirements.Not sure about your state, but primary residence in TX has homestead protection against most creditors.FLP, like the name suggest only has family members as partners as defined in the agreement. 

This is known as the self-sufficiency rule.

is that sufficient?