It's hit or miss and comes down to your pitch and/or the owner's appetite for it.

Depending on your tolerance/ appetite for transitional hoods there are other options.

There is a big appetite right now for 5/1, 7/1, and 30 yr fixed in the secondary markets.

I think my backyard (Northern Virginia) is too $$ for my current risk appetite so I am planning on going out of state, hadn't considered Baltimore until seeing your post. 

Keep in mind that HELOCs are adjustable rates, and are determined by the US prime rate (currently 8.5% plus a margin - which is determined by your FICO, Loan to Value, DTI, and the banks appetite for that product).

With short term rentals the seasonality suppresses the gross rental revenue to get great cash flow unless you come in with 50%+ down, with that kind of down I can find vacation rentals starting in the $350k range that will show decent cash flow.

We place their money within their appetite for risk tolerance. 

Take small steps like others said and if the first deal or two build up your confidence and appetite then keep investing, if not then REI is not for you.

The return on a single asset can be higher than a fund, but as they say "higher risk, higher return" so determine you appetite for risk and proceed with caution! 

i think a couple of friends of mine are doing this. they borrowed against their primary, i think as a 2nd TD on top of their low-interest 1st, and are now loaning those funds out as private money funds. personally its beyond my risk appetite, but to each their own.