I am not familiar with the area at all but the only upside could end up being appreciation and I'm not a fan of speculation.

Edit: 2,100 monthly is about 1.3% sales price ratio. 2% depending on how rough the area is or more is ideal although many investors in speculative areas that are overheated can't get close to the 2% rule.

With the Metro extending out down Wilshire all the way to LAX, the revitalization of the LA River, 94+ new developments in Downtown LA, and rising rents, I speculate a lot of growth opportunity in the historically working-class neighborhoods.

If you have so much cash you don't know what to do with it, then buying for speculation is fine, but if you are looking to grow your wealth, always start with cashflow properties.     

So, its speculative.

., speculation), the purchase price of this house ($129k) was approx. $4k above the market rate in the immediate area.  

If you start with the property you're speculating and wasting time.  

The only people buying right now are investors who are speculating.

Overall, owner finance do come with risk, either you buy way below market value or you hope for "speculation", I mean appreciation.

A recent article from Curbed.com about the “ghost towns” in Ireland, gave me a chilly reminder about the craziness of speculative real estate bubbles.