My wife and I are occasional flippers with 4 under our belt and we typically use a heloc on our primary to secure hard money and pay for rehabs.I own a plumbing company I’m just getting off the ground and know the money will be there eventually but could be a while.My mother in law lives in CA (I live in oregon) and they have a few rentals plus their primary that they have 1million plus in equity in.

We have about $350,000-400,000 in equity in the house (very hot market), and our rate is 3.1%.

I not only receive monthly cash flow from my Long Term Rentals in the single family and small multi-family space, I get monthly growth in equity each time a mortgage payment is made.  

The data shows that investors in equities have a ROI of 3.17% during the period of 1990-2010.  

Question: Given I have about 160k in equity (pre closing costs), would you wait until rates dip over the next year or two and refinance to pull out some money?

Purchase: $385KRehab: $45KTotal Cost: $430KTarget Rents: $5,100/mo; $60K/yrEst GRM: 7Est Cap Rate: 8-9% (8.5% @ 40% exp. ratio - all utilities metered & paid by tenants)Est Cash Flow: 10-13% (leveraged, w/ 25% down)Built-in Equity: $50-100K?

That will give a false rise in equity, a portion of which they can claim later on. 

Within a couple years, they're looking at a minimum of $1M in equity. $1M in equity at a 4 cap rate = $40k/year in income, not including their ROI.

Is it possible to live in this house, pull out $50,000-$70,000 in equity if the HELOC qualifies, and then apply it to the property I am living in and also use the remainder to put a down payment on another house?

If market rent is only $1600, then that will hurt your DTI by $300 (75% of $1600=$1200), you can still keep it as a rental, you just won’t qualify for as much on house #2.Calculating your Return on Equity (ROE)Say you paid $250k for a property and the PITI (including HOA) is $1500, current value is $330k and you owe $230k, so you have $100k in equity.