Never invest in any city on this list of the 50 most dangerous US cities.Low operating costs: High operating costs are one of the driving factors for many companies, leaving states with high taxes, regulations, and other costs.

I’m guessing that is because of your pessimistic view on the economy right now, but even if the markets dip temporarily, based on history, they will rebound to even higher points (I know just cause it’s happened before doesn’t guarantee it will happen again).Personally I have a successful business, but opted to diversify into real estate because my industry is heavily regulated and one change of a law could make me MUCH less profitable.

The California government will deal with the damage the same way all governments do , they will find a way to raise taxes or get the Feds to pay for it ( that will be difficult with the new administration ) Here is what I find ironic , California has C.A.R.B. to pass regulations on vehicle emissions .

Ensure you understand local regulations regarding permits; it’s usually a good idea for your associates to form an LLC for liability protection, but individuals can do renovations as long as they pull the necessary permits.

That doesn’t go unnoticed by regulators.

Then a hiring increase for local regulation officials or private sector to assess housing quality & approve it.

Distributions from a regulation d fund like this should be treated as passive income and therefore not be exposed to self-employment tax.

Now, if they are following SEC regulations, these should be spelled out in the PPM, but they might not all be in some glowing, highlighter-green table.  

You need to research/know the rules, laws and regulations (including HOA if applicable), like you'd do in any US city.

One that may not be rebuild able under current regulations.