In my (first hand) experience with this theory, I disagree. I had to find out the hard way though. I couldn't afford my first one and justified this approach to myself. Perhaps your financial situation is different than mine so your results may vary?

What you describe works great until your 3 year old furnace breaks, a 5 year old pressure tank bursts (when you are in BUF on an overnight and some idiot hits the side of your duplex with her car.

On paper it looks great! I agree. And I understand the theory especially with these interest rates we are seeing. It comes with it's own risk though.

I'll add that if you aren't personally wealthy, your ability to move on other good investments is non existent when you have no equity. It's just a risk that can actually slow down a persons financial progress.

There are differing schools of thought on this stuff and it depends on a lot of different variables that are unique to your own situation.