$250,000 House or $60,000 House?

[Sasa Rakovic]

Hello everyone -

I am new to this website as well as new to real estate investing. I was considering getting a house in Southern California currently selling for $250,000 as an investment. I am ready to put 20% down payment on this house.

Having read most of your posts I am second guessing my decision. It seems that majority of the post I have read talk about monthly/yearly cashflow. I understand current economic conditions and possible future risks associated with my potential purchase.

Rent charged would cover my mortgage but I would obviously not be even close to the 50% rule. Price of this house at its peek was about $480,000 couple of years ago. I understand that it might take more then a decade for prices to get where they once were. I am ready to wait it out.

My question to you all is : "Am I completely off by considering to purchase this house as an investment?

Any advice would be helpful.

Thanks