What are you trying to achieve by “gutting” the house?
If you desire to have all new plumbing, electrical, and mechanical, then it makes sense. But it will cost a lot. If you just want drywall instead of plaster, why? If you want to move a room or add space for a bathroom, why not do just that work?
In terms of hassle, if you’re doing a lot of work, yes, it is easier to do it all at once and simply rent some other place for a period while the work is being done, or at least the major, dusty work. You can move back once things are functional.