Is using a HELOC from your existing home for the downpayment for the next place an option? 

I’ve seen some investors do well focusing on the right neighborhoods, especially if you can find decent tenants and keep vacancy low.The fact that there are way more homes for sale than for rent does raise a flag, though it could mean it’s a bit saturated or folks are just trying to offload properties fast.

The market seems pretty saturated so it doesn't seem to me like buying a random STR specifically for depreciation makes a lot of sense... 

Higher returns, strong occupancy, less saturation. 

Is it better to put down 20% and use a bank loan or is it better to Take Over Existing Loan - How Do I do that?

It's a popular location but definitely saturated.

Determine the strength of your existing location. 

Once it made the list on AirDNA a bunch of people bought up properties and saturated the market. 

Was able to use our existing property as leverage on the new property thru the same bank.  

Does this exist as a product?