2 Houses with Equity and 50K - What would you do?

[Michael Furcron]

I have a general game plan, but would LOVE to hear what more experienced investors would do with my situation.

First off a quick description of my situation and my goals.

I am 31, we have about 50k in cash to invest and some equity in 2 houses. I worked for a small property management company for 5 years and manage the houses we own, I currently own a small carpet cleaning co. and make a good living (trying to same as much as I can to invest in RE).  I am pretty handy and do most of my own repairs and improvements.  I am mostly interested in buying, improving, and holding (for now). I am focusing more on the long term and not terribly worried about huge cash flow, although would not invest in a house without a least $100 positive cash flow, preferably $200.

We live in Northern VA, area which is a pretty expensive area... avg home price is $407k in my city. A 250k townhouse can probably get around 1,650 in rent.

My wife and I have owned our primary residence for 3 years...Bought it for 330k with 20% down as a short sale that needed some work and was a steal even at the time.  After some small and a few big improvements it is probably worth around 420k. (about 80k in equity, after leaving 20% in)

We rent out my old TH which is owned by a small partnership and can't use any of the equity in that house. So not much I can do there.

We also rent out my wifes old TH which she bought for 170K and is now worth about 220K. We owe about 134k on that house. We rent that one out for 1350/month and net about $100 a month. However, I am certain we can raise the rent next year $50 and PMI will be removed saving another $53/month. The rate is 5.5% so if we refi to pull money out I think we can prob get a better rate too. (about 42k in equity after leaving 20% in)

My plan (at least before talking to you)is to buy one house early next year, put down 20%.  Shoot for a house that needs a little work around 200-230k, fix it up and rent it.  I think if my numbers are right we can net around $150/ month on that. Once we are set, save up and do the same again with a 2nd house. Being that I am pretty busy with my business, planning on managing, and doing most of my own repairs... I don't really want to buy several units at once.

I guess I am wondering what someone with more experience would do with the equity, is it worth refinancing either house... is it better to refi the rental then my primary residence? 

What would you do? Can't wait to hear from you guys...