Best plan of action. Not believing in the numbers

[David L.]

I'm been burning thru podcasts and forum posts. There are so many different opportunities you can get into, it's a bit nerve racking on choosing which path to go.

I am looking at the Los Angeles market (or within 2hours). Target range of $170k or lower. Which means not many options. Any guidance or thoughts appreciated.

Option #1: SFH in the inland valley under $170k is still hard to come by and the distance of having to drive out there and such is a consideration. There's San Bernardino but from posts I've seen I'm not willing to invest in that area. Pomona and Riverside seem to have some of the lower priced housing. If anything, a little worrisome since they have a lot of low priced properties on the MLS. Is there anything in this area that is troublesome?

I would prefer to buy and hold. Flipping is okay and starting on my first deal as a flip will help me get some cash for a large downpayment and give me more opportunities for my 2nd deal. I have flipped 1 property in the past so working with contractors/subs is not new to me, as well as doing comps and selling/staging. Those are all fine, it's finding the deals that are very difficult. I have MLS access and nothing on the MLS is showing 50% AFV. Foreclosures may be one way to go but I have such little financing to work with that anything outside of cosmetic, I won't get lending. Open to flips but haven't seen much opportunity for me given the financing. Hard money is something I am looking into but I don't have 30% down on my end.

Option #2: go out further and flip or buy/hold in the desert. Property out there is cheaper. Vacancy scares me, seems like a crapshoot. I've seen listings for a 2bed house for $650 rent sit for 4mo+. 

Option #3: Buy an apartment or condo for cash flow. I found an apartment for $150k the outskirts of LA. Not too far, near stores and a downtown area. Not the worst area but it does have bad areas. It's a 1bed/1ba. With 7% down, the estimated mortgage payment is $900 according to zillow calculator. Rent according to Zillow/Realtor.com in the area seems to be around $1200-1400 for 1bed/1ba on the same street with the same sq ft. HOA is $300. Total is $1200/mo. Unit is completely turn key and remodeled. Currently the profit is between $0 and $200. I can increase this number by putting more down as well as finding a tenant who will pay $1400 but it's no guarantee I can charge that high.

The prelim numbers seem to work. What am I missing? It's also close to where I live and work, I won't be requiring a property manager I will manage it myself. Any cash flow would be saved for expense fund and then a year later, refinance into another unit in the area. 

Thoughts?