I'm not satisfied with not filing the rental in an LLC simply because it's more simple and might cost me an additional filing fee .

You could also get a line of credit for about $150k (you should be able to borrow 75% of the value.)The reason I suggest this is…1) you save $40-$60k in selling costs. 2) you have a lower blended interest rate (2/3rds at 3.25% and 1/3rd at 7 or 8% instead of the whole $500k at 7 or 8%) saving you another $1k/mo in interest. 3) you only pay interest on that $150k when you actually use it, not from day 1  Unless you hate this property, or want to buy something you can’t afford without selling, that would be my plan.

Then you'll have to figure out how you fund the project (land purchase + build costs).

This lowered my cost basis per lot by 7k.

In some cases, after running the numbers, I’ve even faced potential negative returns, causing me to miss out on promising deals here in South Florida.That brings me to my question: I currently own two homes—one is my primary residence, and the other is a rental property.

With running this "business" there will be operational input costs.

If a Seller pushes back based on the "potential rents" then just use the excuse of the cost of turn over needs to be factored in.  

 I am a relatively new house flipper.  One of the issues I have noticed is that some people think of a flip house as being the cheapest possible rehab.  To address this I took detailed pictures from beginning to end o...

Don't look for lowest rate, look for lowest cost on fees as you will either refinance out of that loan or sell- the prepay will hit you on the back of the head like a cinderblock wall.

Angel investors might be interested, but you'll likely have to give up a portion of the ownership or future profits, and there could be potential complications in managing the investor's expectations and involvement.