Heloc - Appraisal vs Online Estimate

[Bradley Abramson]

Good morning! 

I am a relatively new investor that purchased my first house hack about 2 years ago. I bought in a great area (South of Denver) and have seen a significant appreciation on my property already. I have refinanced and removed the PMI I had initially, bought down to a lower interest rate (2.75%). I am now looking at getting a second within 3 months and third home within the year.

The second home will be out of state and will be used to help family, while also investing in a developing small town. The third home will be a primary residence in which I will house hack again and turn my current primary residence house hack into a full rental. 

I have gotten a preapproval and should be good for the second home. Instead of removing money from my long term stock investments, I am utilizing the appreciation and taking out a HELOC on the first home.

I reached out to a local credit union and got a good rate offer. Here is where my question comes into play. I got an initial HELOC offer of about 75k based on an online estimate. This estimate seems low (510k), especially when the appraisal when I refinanced (1 year ago) was 497k. The part where I get caught up, is that the redfin estimator is showing nearly the same value as the online appraisal (510k) and Zillow is showing nearly 575k. I know zillow is a little exaggerated and that redfin is "closer"

The appraisal however is going to cost me 700$ to get done. Currently there is a same sized house with newer exterior paint on my street for 550k, and others that have sold from 540-570k. Looking a price/square foot, the current appraisal is approximately 230, while homes are going/sold for 240-250 a square foot. 

Is it worth the extra 700$ and additional time to try to capture an extra 25-50k in HELOC?

Currently the 75k would be tight, but doable to purchase both homes in the future with roughly 5-10% down and closing costs. 

Any feedback or items I haven't thought about would be much appreciated. 

best,

Bradley