I give annual rent increases without exception.

I would love to use this the equity property to leverage us getting more properties and starting the method.However, when we reached out to our mortgage broker, he said we’d onky be able to pull out about $28,000 and that our rate would increase drastically (currently at 4.2 on a 30 year fixed).

Accept their notice and start marketing the unit and prepare for quick repairs and fast turnover.....let them go.You didn't screen them or accept them....no deposit (red flag)....below market rent (probably no increases in the 3 years)....and they are giving you their first test to see if you flinch....don't flinch.Yes its a business to make $$, but you also cant run a business out of fear....... the short term "pain" of vacancy can result in a long term benefit .

Here is my breakdown:Surrey townhouse increased 22% (Almost double what I purchased it for in 2010)Sechelt house increased 10%Nanaimo house 1 (desirable area) increased 7%Nanaimo house 2 (less desirable area compared to #1) increased 12%Campbell River house increased 10%My investment portfolio assessed value went up approx. $220,000.My primary residence (Richmond) went up 13%, over $160,000.

Also, it's hard for banks to sell to individuals off market because it shows favoritism (it is favoritism) so to reduce liability/impartiality and increase transparency banks almost always go through a 3rd party broker. 

The companies I work for always give me a stipend for living expenses, I will be living in Pittsburgh for 7 months this year and want to hopefully find a good single or duplex to live in while working and use their money pay down the mortgage, and do some minor upgrading to increase value and then live in it until my contract ends .

That and my subsequent experience as a Real Estate Agent is a foundation for a new initiative, a new result and an outstanding life.

Additionally, I'd increase your Vacancy to 8% so that you are saving up aproximately one month of rent per year (1/12 = 8.333%) and I'd defintily increase your CapX to 10% as CapX is for major repairs and since this property was built in 1984 I'm assuming it will have some maintenance needs sooner rather than later.

Also, are rents increasing in the area?

The biggest increase in value is finding a value add, increase the square footage, add a bathroom and modernize.Most projects like this are older houses.