We are doing everything we can to hold off until then but with the increase in taxes, insurance, and debt; it's really getting difficult to be able to wait it out.

I don't want to get too deep right off the bat, but suffice it to say that you can find a way if you're interested. 

I will also disagree with everyone above, you could make both of these strategies hands off, with the right moves.These baby steps during the next year will gain you the confidence and the knowledge, to best utilize that 100k, if that is the best case at that point. and you may be able to stretch that 100k into a few deals, or limitless deals if you have the right pieces to playHappy to chat more and give my guidance!

If you itemize your taxes, this may be used as a write off (I am not a tax professional, so please consult with your tax preparer/cpa etc etc).

First off, MANY wood floors are not hardwood floors.

Hi Enos, It sounds like you're off to a great start with your house-hacking strategy in California!

I have paid/settled everything and have few credit cards and my fico is in the low to mid 600s.I have pretty decent income ($400K+) and am interested in starting off small.

Also, full disclosure - I have utilized creative financing & transaction structures (installment sale transactions, had the seller take back 2nd position notes, baked brokerage fees into the agrement of sale  in off market transactions to name a few), so I am not opposed to it, but they were utilized in very unique and circumstantial land entitlement transactions. 

It will be tax free when it cooks off..

Yeah I would say both appraisals were off.