Novice CA Bay Area investor

[Ray C.]

Hello BP community- I am a physician and novice investor born and raised in Silicon Valley. I've witnessed my own parents invest and manage rental properties since the 70s. I would help answer tenant calls, help dad w/ repairs and maintenance, etc. It was a stressful and time intensive process for them and I vowed never to do real estate. Until 6 months ago, I've only invested in index funds but after seeing the power of REI, I decided to get educated and jump in. I had bought my primary residence in 2008 and now have significant equity. I couldn't stand seeing that equity idle and not working for me so I got a HELOC and combined it w/ savings to buy my first rental property. Now the Bay Area is quite pricey with low inventory and high competition. My criteria was within 1 hr drive, 9/10 schools, and older A neighborhood. After 6 mths of searching, multiple unsuccessful offers, I closed on a nice rehabbed property in the Tri-Valley area. In the end I wanted something I was proud to have in my portfolio and I could live in myself. My target tenant is a professional high income family who will pay and stay long term for kids schooling. It's under property management and rented in less than a week. I debated whether to allow pets but decided to allow a small dog since many high income families have pets. It is negative cash flow but I'm holding for appreciation for 20-30 yrs. I see it as reinvesting. In the meantime, I will pay down the HELOC aggressively and build up savings to do this again. My goal is 5-7 yrs before I can pull the trigger. The problem is this as hard to scale quickly. Hope to hear from veteran investors in this area who have gone this route. My colleagues in health care are a conservative bunch and think I'm crazy so I need to expand my circle a bit to include like-minded folks. Cash flow folks-please don't trash me. I need some encouragement here.

My next project is to convert into SD IRA and invest in some sort of RE vehicle. I'd like to use leverage but non-recourse loans are hard (need positive cash flow) so CA Class A properties are out. Deed trust seems interesting.

Thanks for reading. I've already learned tons from BP podcasts, forums, blogs and books.