Flipping (Another Property in the ATL)?

[big dog]

Hey Folks!
First off, this is a great site with a lot of useful information.  Thanks to everyone for the info. you've contributed.

In any event, I need some advice.  Here's the situation:
I recently purchased a home in an intown Atlanta neighborhood.  The neighborhood is currently in transition, with a lot of 1950-60 era homes being bought and torned down for rebuilds.  The new homes are selling in the $350-450k neighborhood.

The listing price of the property I purchased was $183,000 (we can used that figure for purposes of discussion since it is public info).  The home is 2bed/1 bath, with a narrow but deep lot.

Here's my dilemna....i need to decide whether (1)  I put $50k into the house to do a no-frills addition to make it a 3/2 and put it on the market, expecting it to sell in the $250-275k range or (2) do i tear down the house and build a new one that will sell in the $400-450 range, assuming i can get the new one built for $150k (if that's even a realistic estimate).

The first scenario is less risky and will likely get me $20-45k in profit.........the second scenario is obviously more risky (final building costs, high sale price of new home, etc.) but will likely profit in the $70k-150k range

Actually, i guess there's also a third scenario i've considering.....that is, just putting $5-10k in to update the existing kitchen and bath and putting it back on the market as a 2/1 and hopefully sell for $200-210k and in the process make a quick $20k profit with low risk....

i know this is a lot, but any thoughts/insight would be greatly appreciated.......

thanks!!!!