Joe, I agree with Michael, don't leverage the home you are living in - it's your home, not an investment. But if the cash flow from your current rental is twice what it takes to cover your expenses and you have $100k in cash then I do think it's time to consider leveraging that asset. The banks won't allow you to over leverage in today's market. You will probably need to maintain a 1.25 debt coverage ratio in order for the bank to lend you money but it sounds like that is not a problem. I also agree with Mike that timing is not the most important issue here. Finding the right property (preferably multi-family) at the right price should drive your decision. You make money on the buy-side of the transaction.
Curtis, if you are looking in Seattle, I think a great neighborhood is Ravenna. There are currently some great homes near Ravenna and Cowen Parks which are the parks where I take my two boys. Other neighbors I like and have good parks are: Green Lake (certain parts only), and Wallingford. When looking at neighborhoods our houses and determining their walkability I suggest www.walkscore.com. Also, here is a link to the Seattle parks page: http://www.seattle.gov/PARKS/
Joe, remember that cash is king. Keep as much of it as possible on hand. Talk with some local banks about your position and see which banks might be willing to let you leverage your current assets and perhaps only put down 10% on a new rental. It's better to bleed a little bit of cash each month while you get that rental squared away than it is to tie up your cash.Another thing you might want to consider is looking at small multi-family rentals such as duplexes and four-plexes. This spreads your risk and in the long run will probably produce a better cash flow for you than a single family home will. There are some great loan options out there for these types of properties including FHA loans with as little as 3.5% out of pocket. If you need a lender who can help you find a loan like this email (firstname.lastname@example.org) and I will point you in the right direction.