The law of diminishing returns still applies. 

That way of think has its law of diminishing returns now that I'm being accustomed to never meeting unrealistic goals.

Thus, diminishing margins. 

But as one gets worse (CA) and one gets better (Great Lakes) that gap will diminish. 

And, yes, if you're LTV is hurt your exit (i.e. ability to sell the property) options will diminish.  

Technically, if he lives to be 78, then $80K will have been invested, but if he's able to take out another $24K (tax free) between now and age 78 (not to mention loans against it while benefit/interest accrual stays same)...then it still beats any Savings Plan I know of...and his family gets $80K when he dies...I suppose diminishing returns would start at age 100...sure the evil BIG INSURANCE company got a lot more out of our money...but so do those evil BIG BANKS...Policy was taken more as gift for later in his life since investing in Whole Life (as stated above) goes against everything A.L.

Mainly, i have family there that can assist with any issues, i live in California and if necessary could be there in half a day, and more importantly i have a contractor whom i know i can trust on quality and pricing.While not dead set on this, being completely green to investing, i certainly feel this may help me get started and diminish my risks as opposed to say Texas, or the Midwest, where it is completely foreign to me.I know the phoenix market is hot, some would say overpriced, right now.

As you no doubt are aware, as the interest rate goes down, acceleration of an amortized loan using a velocity account which charges interest produces diminishing returns.

Variances are allowed in pricing as common for the area.Then look to appraisal guidelines as to the treatment for excess land, the value diminishes as excess land increases for lending collateral value and as to market in residential uses.

But, most developed economy governments around the world are now running at 100% debt to GDP or more and interest rates are already low, so the tools to react to a future crisis are diminished.