These folks usually get all excited about sbu2's and other "creative practices, many being shady at best and some out right illegal.I am usually fairly private but recently I have shed some light into my experience as well as finances over the last several years.My experience is that I made over a million in RE in the last 8 years and thats chump change by my demographics and standards.I ended up buying properties at 50-60% of FMV and these properties tripled in value over a 5 year period.

Check the demographics.

Narrowing down your target demographic will definitely help make things easier when finding an end buyer.

There is different demographic and site criteria and prices for land that will be paid etc.

At least thats how I like to look at this type of project is to simply say whats my exit strategy if it gets ugly, and what recourse could come back on me (aside from losing that particular property and invested monies).Anyways, one thing that comes to mind for me is the Redding demographics and wondering how that would play into my renters pool.

I do think these investments offer great opportunities but only for those who are the type to operate liquor stores in the inner city.Class C properties can offer decent cash flow 1-1.5% GRM  while also offering appreciation in markets with good systematic demographics.  

You can use readily available demographic information to figure out who lives there. 

First off, you need to do your demographic studies on the area to make sure it is the right place to invest right now, or has a strong potential for future growth.Once the area checks out, you need to have a very good understaning og the rental rates (not just the opinion of one or two PM companies), know the market price for homes (break this down to price per square as well), and know the current inventory, past inventory, and all other pertinent information which can be gathered from the MLS.Doing complete rehabs from afar is very tuff to do.

In my market, the MLS stats verify this fact as well.So, knowing the CA demographic is similar to ours, I suggested he consider this as a buy and hold investor.

like Jon I would definitely want to get to know the location and try to understand the demographics and market before investing anywhere.