REO Investing for maximum returns

[Quest R.]

Hi,

We live in San Diego and have been investing in real estate since 2003. We had 2 condos here which we sold by 2006 and we own a rental property in Tucson currently.

We are looking to invest in Real Estate again but we have a limited cash pool of 170k. Our plan is to invest this money as down payments on REOs and get REOs in So Cal.

We are planning to buy and hold properties here to get cash flow and wait for the appreciation. However, the property prices in San Diego are high and hence we are looking at Inland Empire to invest. What is th best way to invest in Real Estate using our cash? Does buying REOs in So Cal (properties for buy and hold) make sense?

Any help and advice is appreciated!!!

Thanks