Starting out in California

[Aaron Hill]

I have been looking for opportunities in and around Placer County, since that is where live and it seems like there are not a lot of investments that would provide any sort of reasonable cash-flow around the area at the moment. From what I have seen, the rent that can be charged would barely cover the mortgage in most situations... I am thinking that it might be a better idea to look for rental properties in a different location even though that would mean hiring a management company to look after the property on my behalf. Can anyone offer advice for buying in Placer? I would like to keep it local so that I can manage it myself.

[Aaron K.]

The thing with Placer is that tends to have some of the higher end inventory of the Sacramento metro area, so unless you're down by Tahoe I'd probably look at the whole metro area from Yuba City to Lodi at least and maybe even Stockton as well.  California in general doesn't cash flow the same way that people on BP claim their investments cash flow but a couple benefits are the historically faster rise in rental rates and prop 13 which keeps your property taxes low, not to mention the appreciation which you should just look at as gravy.