Does it have to thrown off that kind of cap rate and you need that cash flow or if you have enough cash to be comfortable most seek a "flight to quality".I can tell you owning a lower income property and living the headache and actual returns is VERY different than theory and thinking about taking on such a property.The plays I see is seasoned investors buy these and clean them out and then force appreciation and sell off in one to two years max.

All the podcasts I've listened to from seasoned investors suggest getting your real estate license.

Thanks for letting me know about meetups in the area, I would love to chat with other Bay Area investors.I definitely think East Palo has started to gentrify (Starbucks, Home Depot, Four Seasons all contribute $), but schools still have a long way to go.I bought in East Palo Alto in 5/2009; a fixer in East Palo Alto in 2010 and sold that; a fixer in Redondo Beach in 2/2011 and a fixer in Mountain View in 1/2012 but nothing since.

I'd suggest you allow at least 6 months seasoning for a loan made from equity of the seller.But really, just avoid CFDs.

This is convoluted enough to make a seasoned guys heads spin, let alone a newbie without money to put down 500.00 earnest money.

I just moved to Tacoma Washington from Los Angeles so I'll be here for a little while but I love San Fran and I used to date a girlfriend who went to Berkeley so we were up there a lot during football season.

This is what I'd do (and have done in similar situations): I'd take her now but only make the lease 6 months so that you can get it in-sync with the prime renting season going forward and get a better read on this tenant.

It's also an easier way for me to repay my investor as it wouldn't require taking out a mortgage after a 6-12 month seasoning period.

Second, the two PLRs had a specific fact pattern that generally requires some restructuring of the ownership of the property that you would want to build on, which may be deemed as a step transaction unless you have some seasoning (time).

If they are doing a rate/term refi there usually isn't any seasoning needed.