Here's my reasoning: -Although cap rates on the open market are comparatively and seemingly inferior to that of out of state deals, the appreciation and general perceived safety of California apartments far outweighs higher cap rates of multifamily elsewhere.

Would you say if the interest made on the investment outweighs the interest cost of the loans then the investment should be a go?

I don't see my investments immediately outweighing the heavy 6.5 interest rate.

I've been looking at them for $120k.I know it is more of a risk but if the numbers work I don't know if the benefits might outweigh the risks?

But if it is cheap enough and generates enough cash flow, the cons in the deal could be outweighed.

It hurts alot less when it is a smaller % of your income.Another plus is it is easier to manage having 4 units at one location vs. driving to 4 differnet locations to manage.Of course multi families do have down sides - but the positive IMO definitely outweigh the negative.I'd like to end this by saying Single families can be a great investment as well if you get it at the right price and location.

IMO the downside risk outweighs the upside potential.Doing a flip from a distance can be problematic but not impossible if organized correctly.

What would be your concerns, and in your eyes would the risk outweigh the reward?

But until you've maximized your 10 low cost conventional mortgages, the opportunity cost of paying down principle FAR outweighs any interest savings.

I think the costs WAY outweigh the benefits.