What are some other emerging markets maybe with a bit lower to cost to entry for a BRRRR strategy?

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.

@Jonathan Bombaci recommend using that amount as a bargaining chip for lower rates.80% of evictions are wash, rinse, repeat. 

Also I understand the funds aren't available for the improvements so that is another obstacle that has me leaning towards price reductions to move on as soon as possible.The exit of lower tier SFH's is something very few investors care to consider when making their investments but deserves far more consideration. 

My goal of refinancing was simply lowering our monthly spending to reallocate towards future investments.

Alternatively, if I can find a lower cost single fam home where I can cash out 100% of my investment I would do that but those have been harder to find recently. 

The lower barrier to entry would be excellent for my personally smaller net worth.

Essentially lower my taxable income by $117k?! 

I know I already mentioned this, but @Mordy Chaimovitz...If you can get by with lower cash flow and invest for the long-term generational wealth (aka appreciation) in nice neighborhoods, that is the way to go, but it's tough to get by at times -- at least it is for me.Just know everyone's situation is different, and you should do what is best for your specific circumstances!

If they have a good interest rate it might be worth looking to see if you could assume their loan to take advantage of the lower rate.