I’m new to real estate investing and am currently looking to move my retirement savings to real estate.

However this is the house that appreciates the most out of the 4 rentals we own.Would love to buy a multifamily (4-12 unit) in a year or so with 25% down using 2017-18 savings and keep the house in question.

Save yourself some gas and frustration.

Save more money

So tapping the heloc prior to sale will not save you taxes. 

Down payments on FHA with closing costs are  around $30K to $40K on a $500K buildingYou can even ask the seller to roll the closing costs for $10K and roll it in the loan essentially paying just $20K downFigure out how to save or get that money as a gift.

House hacking would be an excellent way to get started on that path, and if you have that much cash saved, you probably have the ability to house hack and even invest further if you choose.

Saves a lot of time.Would like to know more about your progress.

Might as well save what they put on top and do it yourself!

This sounds like a good idea and a good way to save money, but like @John Warren pointed out, it is rarely worth it in the long run.