Home equity for second property

The only downside that I see is that you would be leveraging your primary residence at today's interest rates, and if you leverage your primary residence that is mostly not tax deductible. Yes, strictly speaking, mortgage interest is tax deductible, but the standard deduction is now so high that odds are you wouldn't get any additional tax deduction. However, if you instead take the mortgage out on the second home you intend to buy, then whenever that second home is rented out, the interest, taxes, and insurance, are all deductible as operating expenses. So, based on the information you've given, if I were in your position, I would lean towards not taking equity of the primary residence (as much as possible, though perhaps you take same to have enough for a down payment) and maximizing the mortgage on the second home.