Moving a family into a live-in flip: plan, or mistake?

Consider a service business owner, several years running a crew, who has spent that time inside other people's renovations without ever owning one. Now there's a 1960s split level near a good school, $315k, needs a kitchen, one bath gutted, all new flooring, and a basement with a smell nobody wants to name yet. Say the family currently rents for $2,300. Payment on this property at 10 percent down would run about $2,750 all in. Renovated splits in that pocket have gone $415k to $430k. The plan in cases like this is to move in, do the work over about two years using a crew on their slow weeks, then sell with the gain untaxed under the primary residence exclusion, which is the whole reason people take on a live-in flip in the first place. Two real questions belong on the spreadsheet before signing anything. First, whether two years of kids living around a gutted bathroom is a genuine cost that deserves a number, not just a shrug. Second, whether using one's own crew on a personally owned house creates complications in how they are paid and how that gets accounted for, since mixing a business crew with a personal property is not the same as running it through the company books. A neutral-leaning-skeptical spouse and a Friday offer deadline are the kind of pressure that makes both questions worth answering before Friday, not after.