If you cash-out refi, you could get say another $75k in cash in your hand for say  an additional $325/mo (I'm ball parking numbers in my head here with idealized numbers since there are lots of variations...). 

I bought the property in that condition, but really thought we’d be doing the renovations last fall, so we are way behind my ideal timeline anyway.

Schedule E allows all re investors to write off business expenses.

Ideally, I am interested in buying a multifamily house, like a duplex.

A couple of additional notes on the topic:- The property currently rents for $2k/month - I intend to raise the rent 2-3% if a year lease is signed- If I were to agree to a 6-month lease, they would move out mid-January (not ideal)I were to agree to the 6-month lease, what is an appropriate monthly increase for the shortened lease and unfortunate timing? 

Ideally I would do this deal by myself but since they brought it to my attention and want to invest money then they want in.

In the Newhall-Saugus area, one of KB Home’s subdivisions, dubbed Broadview, advertised three- and four-bedroom ranch homes ideal for families.

Some cost that may vary based on location will be your environmental impact study, your list of cost from the Architect may see a lower cost for the schematics on a smaller project, with similar footprints for all four units, versus varying unit size, and scope requirements (less work, lower cost for A&E), the feasibility study, proforma, 3-D renderings, and other associated cost are going to depend on where this project is going to be built. 

But ideally in the long run I would like to end Section 8 completely. 

We're still in the exploratory phase so still nailing down a strategy, but I think we're planning to start with SFHs that cost around 100K - and in an ideal world with the aim to buy one at a time while we get comfortable but hoping to scale up with a new place every 6 months or so until we have around 5.