Gaining equity and converting to conventional loan

[Sarah Wainscott]

Good morning you smart people,

My husband and I purchased a duplex in Kodiak, AK. This is our first home and first investment property via a VA and First Time Homebuyers loan. We are currently operating as a owner-occupied property and are making roughly $900/month in profit. We have renovated the lower unit and plan to make improvements until we receive orders for our next station in 2.5 years. Our ultimate goal is to convert the VA loan into a conventional loan, so we may utilize that VA loan on our next home (wherever that may be). From what I understand, to do so we have to secure 20% equity in the home. Aside from making bi-monthly payments to pay on principal and pay off loan, will our home improvements also go towards that 20%? In addition, what is the best way or who might be the best resource to better understand which improvements will provide the bigger payoff/increase in value?

As you can tell, we are very new to this. Any advice and guidance is welcome!