Hi Chris and welcome to the forum!
Just some thoughts:
Usually investors who use IO loans do so to maximise their cashflow, as the repayments are lower than normal P and I loans. There are a number of reasons to do this, however the main one being so that you have more cash available to buy more property!
I would only advocate using IO loans on props that have good consistent cap growth, as the growth more than makes up for the fact that the principal is not being paid down. In the meantime, by not tying all of my cash up I am then able to go and purchase another high cg property with another IO loan.
To balance this, however, I purchase positive cashflow regional places (in the low $100K's range) and take out P and I loans on them, as I cannot rely on cg, as it can be almost non existent. I then have the option of paying those loans down faster if I channel all the rent into them. In 8 yrs time, they should be paid off and the incoming rent will be all income.
With the high growth place, however, though the principal hasn't been touched, the property may have doubled in value in 8 yrs time and so I have a fat chunk of equity just waiting to be used! My original loan may have been $200K (on a $200K place to keep it simple) but the property is now worth $400K, $200K of which I still owe.
If I did this with a poor performing country place, however, that cost me the same but was only now worth $220K then my profit would be very poor.
IO loans have their place and need to be utilized wisely. There are also many people who are uncomfortable with the idea of having this type of debt, so you need to work out what exactly you want to have that SAN factor (sleep at night).
Sorry for the ramblings