Invest in one local (SoCal) property or Multiple out of state?

[Christina Kim]

My husband and I have only done one deal in the past year (out of state), and we want to crank things up and get more things happening. We've been able to save enough to do something in the Southern California market, but realize our buying power with the capital can get so much more elsewhere. 

We want property in Southern California so we can have hands-on experience with management and have more control over what we buy. However, we can get more doors elsewhere.

Writing this down makes it seem like a clear choice that getting more units would be the right choice, but would there be advantages in getting ONE deal in SoCal over multiple smaller deals out of state?

[Andrew Johnson]

@Christina Kim I would say (and let's overgeneralize for the sake of fun) that your primary residence can be your California asset.  Most of the people buying in California and buying for appreciation.  Assuming you own your home you likely have a good chunk of capital invested.  And if you bought a few years ago you probably have had some equity appreciation as well.  I know your personal home isn't an asset but (like it or not) is has you in the California market.  And there's nothing (down the road) to stop you from renting out your current home (turning it into an asset) and buying another home.

Because of that, personally, I've gone into a cash-flow market myself.  It's my very amateur version of diversification.  There's also nothing to stop you finding ONE deal out of state that is a 5+ commercial property.  It's one PM to deal with, one mortgage to worry about, etc.  And you do get some diversification because of the number of units and it can probably "self-support" easier than individual properties can (portfolio may be different matter).  

Or maybe I could turn it all around and say: "Invest in California because in 30 years when you retire you'll still be locked into a low property tax cost because of Prop 13".

To end my rambling, this is from my perspective as a buy-and-hold investor.  If you're sending yellow letters and looking for flips, wholesale deals, etc. you can toss out my reply as irrelevant!