Next step is typically to file the action at the courthouse, like you said. 

Best of luck as you take the next steps, and feel free to share updates or ask more questions!

The first step I'm doing is checking with the city zoning to see what they would allow before I get too deep with looking at plans, financing and construction. 

Hey @Chris GarnesI just came across your post, and it immediately reminded me of a project I handled with a colleague in San Diego, Dennis Bragg - https://www.biggerpockets.com/business/page/3607  - You’re sitting on some serious potential with these two properties, and your plan to step back from construction while finishing them makes total sense.For Home 1, with no mortgage and a prime design upgrade underway, you’ve got flexibility that most investors would envy.

Do you have a step by step list when looking at the potential house?

Quote from @Shayan Sameer: Quote from @Zachary Deal: As several folks have mentioned leveraging equity in current property you owned is a great tool but still comes with the some of risks as you had before using hard money debt as there is never a guarantee your new project will be a success (there will always be risks with real estate investing).Leveraging your investment property would probably be the first step I would take. 

Steps to PrepareGet Market Data: Research comparable sales to determine the property’s value.

Important that you follow the necessary steps, deliver 5 day notice etc. 

Your first step is definitely learning about the markets you are interested in and figuring our what your desired end state / goal is that you are hoping to achieve through real estate.

I think that many people are not equipped to handle all of these steps.