Another tip I've learned is to open LOC's, borrow against it, and allocate into a vehicle you can access when things get spooky and LOCs start to get shut off.

You'll have to allocate a certain amount to repairs and who will manage the property?

Some have purchased with a 203k loan, some with a regular FHA loan, and some with a normal conventional loan.What typically impacts their decision on their type of financing is the deal itself, how much cash they want to allocate for a down payment, and how much deferred maintenance or lack thereof the property has. 

To get the opinions of experienced investors as to where to allocate the capital.

Search the forums for lots of discussion on the topic.But, to be succinct, imagine buying a $1M fourplex that generates $8500/m in gross income.Now, make a spreadsheet to figure out what each of the following could be:"Cash Flow" - The amount of money left in your bank account at the end of the month (ignoring reserves and non-recurring expenses)Free Cash Flow - The amount of money you can count on at the end of the year (allocating $ for reserves, vacancy, etc)Total Return - The amount that your net worth will increase by holding the investment (includes free cash flow + gains from paying down mortgage principal)Total Projected Return - The amount that your net worth will increase, based on market projections (includes projected gains/losses due to housing market price changes, development/value add for the property, or changes in CAP rate).IRR - Wrap it all up for the expected length of time you'll hold the property to see how it'll perform overall and to compare it to properties in other locales.Now, adjust all those for your personal tax situation to figure out whether it's a good investment for you.For San Diego, you should be able to look at different situations to see why it makes sense for some people to invest there.I haven't yet seen broad agreement on exactly what to call each of those terms *for REI* - there's a difference in terms that real estate finance pros use vs. how us mere mortals speak.  

Some will say pay it all off, but then the argument is that you'll deplete all cash that would essentially be allocated for investment purposes.

She basically said that they do not allocate any money for vacancy because they tell you how to get great tenants (but even the best lose their jobs I have found). 

If you reinvested the cash returns into an additional deal every 3-5 years, while also allocating even more additional personal capital each year, the compounded cash flow 10-20 years down the road, once you now have 5,10,15 different investments, looks very solid.

@Sunny Burns, yes, your math is correct.However, there may be other reasonable ways of allocating your property tax deductions among the units that may result in you being able to shift more property taxes to Schedule E, which I imagine you'd want to do given @Chiwei C. 

How does this work for partially shared areas (i.e. 2 rooms are allocated to 1 bathroom).