She dumped the proceeds from her gain into four homes, that she bought for rentals (full retail, no built in equity, top of the market) thinking she would sell in a few years for a profit.

If I buy a 50K house for 30K, I have "made" 20K in equity.

But they are out there…You need to have a large pool of buyers… you need end user retail buyers, lease option buyers, traditional landlords, rehabbers, and cash buyers….By having a good buyer’s pool mix… You can do a variety of deals…You can’t just look for deals with $50k in equity… those are hard to find every day… But if you can sell what you buy, you can do more volume… I just made this little chart up (below)… anyone care to comment on it?

Maybe he only owes $100k then there's $50k in equity.

But, our old home has not yet sold and we have over $50K in equity which we would like to get out and put towards pricipal on our new loan.

You can certainly start with less, but you will need about $20M in equity roughly to get that kind of cash flow.

So if you find something with $30k in equity that would equate to roughly $4500 for a wholesale fee.

Portfolio designers have rules of thumb about how much to carry in equities versus fixed-income bonds in traditional portfolios.

If long term wealth is your goal then getting a property with 10% cash return may be fine when you add in equity gain and appreciation, that's a personal call.How much risk can you deal with, how much work do you want to put into it (in terms of rehab and management), and what type of returns do you want to get will be the key things that should guide where and how you invest your money.

Sometimes folks think they have $5000 in equity if their house is worth $100K and they owe $95K.