Just make sure you’re comfortable with the interest rate if going either route.  

The rates are great, but you definitely have to work with someone that knows what they are doing...

For now, it Looks like your roommate/tenant can cover half of your mortgage (plus hoa fees). 

My partner and I don't get a cut of any of the money invested, it's a flat-fee membership club.

I find condos/townhomes to be easier to manage out of state because the HOA handles a lot of the maintenance, just be aware of condo fees and find a place that is reasonable like $300-400/mo or less if you are lucky.

You would end up saving the higher interest rate on the HELOC as well as closing costs.

They already lost some major players due to the state capping rates https://www.foxbusiness.com/lifestyle/california-insurance-c... will all insurance companies stop coverage, raise rates or reduce what they cover?

I don't do this for a living and have no real world experience, but at 40% down, even with a 7% int rate, that seems like a high monthly payment.

Quote from @John Warren: @Mordechai Chaimovitz cap rates and NOI are commercial real estate terms, and 1-4 units are not really valued in the same way.

What interest rate are you getting?