It's definitely NOT dead, but, cash flowing or breaking even is significantly more difficult. 

What I wrote above does not create an attorney/client relationship between us.

If he did not have the funds to ride out those difficult years, his investors wouldn't see their money back.

Depreciation can create paper losses to offset rental income or passive income, and qualifying as a Real Estate Professional (REPS) or STR loophole can allow losses to offset W-2 income.This post does not create a CPA-Client relationship.

I personally do not own any rentals here in orange county but we do have clients in that live in orange county and many of them have to go out into riverside county or San Bernardino county to be able to cash flow and just barely nothing crazy.

I have been both an active and a passive investor and I have better results in passive investing - even through this difficult market.The key, in my opinion, to any kind of investing is to understand the type of investing you are doing, the goals you have and the current state of the market. 

However, if it's truly one of those communities that has very high crime and difficult to attract any descent tenants, it can lead to disaster.

And it is difficult for you to refuse to take their rent, as there are many agencies that will pay up to $10k in back rent and rent moving forward. 

So, the real estate broker/agent would have to inform the seller of the fair market value of their home, making it much more difficult to earn a profit larger than what a real estate commission would be.  

Matthew, Likely going to be difficult to find a bank that will hold a checkbook IRA LLC account and pay a rate.