Is my personal residence holding us back?

[Liz Spina]

Help! I think our personal residence may be holding us back. We are on the hunt for our first brrrr property and we will be using private money loans for the down payment. We are hoping to acquire upwards of 20 properties in the next 5 years. Based out of Philadelphia suburbs (Delaware county specifically).

We bought our personal house in 2016 with the plan to either do a live-in flip, or a fixer upper that we live in long term.

The house was purchased for $154k, well below market value (comps in our neighborhood sell for minimum $250k).

We have done almost all of the work ourselves thus far including:

New kitchen and opening of floor plan on first floor (not completed- still needs trim and some custom cabinetry)

New deck and sliding doors

Rework of 2nd floor to add bigger closets, 2nd floor laundry and new larger bathroom (bathroom not completed)

Total cost of renovations so far: $25k

The reason we only paid $154 is because the stairs to the 3rd floor are in the 2nd floor bathroom! My husband is an architect and we have the plans to turn the staircase to make the layout much more efficient.

When all of the work is completed, it will be a 4 bedroom, 2 bath (it was a 3 bedroom, 1 bath at purchase). The problem is, we need about $30k to finish this project. We do not currently have this cash available.

Do we borrow cash to finish the job so we can either refinance or sell and pay back the borrowed money with the estimated $41k equity gained. This feels risky to me because I’m a not 100% confident about the numbers.

Alternatively we will just continue to slowly DIY the renovations ourselves, but I feel like it is tying up our cash and time! THIS IS MY BIGGEST ISSUE. We would rather be focusing on our rental portfolio assets instead of this liability property. (We also both work full time w2 jobs and have two small children).

We did not have any real estate knowledge when we bought this house, and now we are looking for creative ideas to get us out of this mess. We do like the house and could live here for the next 30 years, but are looking for input from all of you creative real estate professionals because maybe you’ll have some ideas we haven’t thought about.

Thank you!