$170K HELOC what would you do?

[Shannon Ludlow]

Close to closing on a $170k HELOC with PNC Bank (no closing costs, interest only for 7 year draw period) due to paying down primary mortgage and market appreciation. I live in Tampa, FL, and most of properties have also appreciated at peak values.

I am currently stuck in analysis paralysis. I’m looking at 2 different investing strategies and would appreciate others perspectives:

Option 1: Use HELOC funds to put 20-25% down on 2 maybe 3 ugly homes with intention of following the BRRRR strategy. With this option, I'm looking at local homes in bad/transitional neighborhoods.

Option 2: Use HELOC to buy 1 home (under $150k), fix up $20k, rent, then refinance at low interest rate and pay off HELOC. This would be a nicer neighborhood, but will take longer to find a deal that meets sound investing criteria.

What would you do? Advice please?