Case Study using 203k loan

[krishnamba]

I have a primary residence.

Purchased  6 months ago at 250k USD.
Zillow says its worth about 268k.

I had 5% down did conventional at 3% for 15yrs.
I see that a huge number of people are repairing their houses and starting to put up for sale signs.

Should I do the same.
I really want to get into flipping so I can get to a goal of 1 paid of home to live in and 1 rental.
I was wondering if I should do a 203k loan and raise my cape house to a dormered house and redo first floor plan.

Is it feasible to do 100k-120k home improvement. I would say looking at the majority of homes sold with raised are going for 400-500k.
I was thinking because I would make it a 30yr mtg the monthly would be same price and I could hold until I sold for price I wanted.

Any ideas?
Market Value: 268,000
Original Purchase price:250,000
Original Mortgage Amount: 235,000
Interest Rate: 3%
Mortgage Term: 15yrs
Term remaining: 14.5yrs
Amount remaining on mortgage: 231,000
Gross Rents: 2k
Principal and Interest (the P&I of your PITI - should match with the above info):
Taxes and Insurance (the T&I of your PITI): 8k
HOA costs:0
Deferred maintenance notes: Will need to change washer, dryer, dishwasher, water is hard needs water softenr+filter.
Some windows need shoes. Heating is 30+ yrs.

[WhatIsFrugalAfterAll]

Here is the thing.. a flip is a big risk.

Say you put 130k into it. But in the time it takes you to finish the flip, property values take a 10-15% dip.  You are now 100k+ underwater. Seeing as you only put 3% down, I make the assumption that you are not ripe with cash right now, and couldn't handle a 100k loss?

There are many paths to riches, and each has different risks.. but for an inexperienced flipper without money to soften the fall, I see the downside as not worth the risk.

[money_bunny]

I was away at school. Where I was staying had cable TV and the Real Estate channel. It might have been Home and Garden TV. There was a show about flipping with this couple that seemed like it had reality tv flavor but was scripted. They made it look so easy. It's not.

I also was thinking how nice it must be to drive up in your luxury SUV and supervise and not be spending all your spare time with tools and paint.