There are risks involved but still very good return.If you are willing to spend more money, you will  be in a decent neighborhood, in a better tenant pool with less headache.It is all about what you want to do.

What you pay for a house involves two parts,,,cash and leverage.The cash you pay must be recovered (through cash flow) before you start to make a profit.The leveraged part impacts your cash flow through the monthly payments on that leveraged amount.

Looking forward to getting involved. 

Once it gets to the point that lawyers, courts, and zoning is involved, you move at the speed of government.....in other words, it flows like molasses. 

Account Closed, I think you need a lot more specifics before you can make an informed decision:What management costs would be involved with vacation rental / AirBnB?

It depends on your interest and the level of involvement you want to have and the time it will take you to learn.1.

@Ilidio Cardoso - I think you missed the point here in my question.There is no bank involved here...We are the bank as we own the note.

We are also interested getting involved in wholesaling out in the Inland Empire so I am still doing my homework.

@Alexander Vasquez I dealt with this earlier in my career and I just made sure I was the most prepared I could be from a knowledge and market perspective when talking to more seasoned investors or just in general when I spoke to older people who were involved in real estate.  

Purchase price: $450,000 Cash invested: $1,500,000 This project involved renovating an old commercial building in Oakland into five live/work condominiums.