At this point I am debating whether I want to purchase a small multi-family or a single family to rent or the alternative is to buy a new primary residence and rent out our current residence, but with a one month old baby, a four year and a wife the thought of moving is a little overwhelming right now, so the jury is still out on what I want to do.

@Nathan Killebrew, I think it's great that you have this mindset and that you are keeping your mind open to a different kind of opportunity.It's a delicate balance between remaining focused on a particular strategy so that you can see your goal through to a succesful conclusion and also being careful not to miss an opportunity which might be a little outside the box.I was listening to a podcast interview with Tom Dunkel recently, he has been investing full time in alternative assets since 2006.

You could do something like that and alternate who takes on the mortgage.

That being said, I certainly can see value in generating such a business plan if you want to look for alternative lending for your STR's. 

In the alternative, you could bolster your investment accounts for the time being.

Alternatively, I have thought about refinancing it and pulling cash out to invest, but doesn’t refinancing trigger a reassessment of property taxes?

In my area the cost of a SFR is hard to get into cost wise.I would not buy a property just based on the STR income potential but other fundamentals need to be considered.Comps, condition, standard rental value, cost per sq foot, etcHave a good exit plan and alternative strategy. ie: regular rental, owner occupied, resell etc

My only concern is 'opportunity cost' and alternatives to high asset valuations created by recent appreciation.

Alternatively, if they stick with 1k houses but hire more competent rehabbers, it'll cost Zillow a lot more (b/c why would a successful upper tier rehabber sell out and work for Zillow?)

The other alternative in that range would be muni bonds.FYI...people have been predicting a recession on these forums for the past five years.