Cash Out Refinance or saved cash

[Alyssa Faith]

Hey Y'all,

I have owned my home in Jax, FL for a little over a year . There are some renovations I would like to do before I think abt renting it out or selling it. 

Such as:

Quarts countertops and backsplash in the kitchen

removing the carpet in the bedrooms and installing LVP and upgrading the closets in each room

installing a new AC unit (mine is ~20 years old but still kicking)

recessed light fixtures, etc.

I do have abt 40k saved to do such renovations but maybe I should look into Cash-Out Refinance only so i can use that additional money saved for another home...

I bought the home at 230k and the value now is abt 280k.

I just came to see what the popular opinion is. 

Thanks 

[Luis Olivier]

Hi Alyssa! Sounds like you're in a pretty good spot to look for your next deal! I would consider using your saved funds to purchase another place and rent out your current house as it is (assuming your house is in good condition). Quartz countertops and backsplash sound like an expensive add for not much more return on that investment. You could replace the HVAC. However, it could keep kicking for another few years, you never know. I would go with replacing the flooring and closets if you really want to, not crazy expensive and it will add value to the property. Doing a cash out refi right now with the current interest rates will probably increase your mortgage which would cut into your profits. Buyers would care about those high end finishes but renters don't care as much. High end finishes will marginally increase the rent you can get. Hope this helps.