MOST OF PRICE CHANGE FROM DECLINE IN RATESOf the approximate $210K change in median home prices from 2008 to 2014 in the Bay, about 80% ($171K) appears to be attributable to the mortgage payment impact of interest rate reductions from 2008 to 2012, and the remaining one-third to everything else, including income changes, tech, foreign buyers, investors, etc etc AND reduced affordability (aka, buyers paying a bigger percent of their income on PITI; aka, reduced HAI).RATES DECLINED BY 313BP DURING LAST CRISISFrom August 2008, when the conventional 30yr fixed mortgage rate was 6.48% to December 2012, when the rate was 3.35%, we experienced a quite large 313bp decrease in 30yr conventional fixed rates.

This allows me to claim the interest expense from the loan as an investment expense or passive income expense depending on the final usage.My loan however, is set up with an escrow for taxes and insurance so when I get the loan I'll get a check, and I'll get a pre-funded escrow account for taxes and insurance.As the usage of those escrow account funds will be for my primary residence, it would seem to be considered a personal use of funds and therefore, to the extent of the use of those funds, I would not be able to write off the interest attributable to that portion of the loan proceeds. 

So, essentially, you need a property to attribute these expenses to, and without one you don't have anything to deduct against.As others have suggested, you could always consult your tax professional for more specific advise based on your individual situation.

I can attribute much of my REI success to the folks there.

Are there any undesirable attributes in the area that would drive away future renters and make it hard to get a tenant?

Make sure that you embody all of the attributes that you would appreciate in a top notch realtor.

Of greater importance is:Don't get sucked into D class being great cash flow its only great cash flow on paper generally... the reason its D class is you WILL NOT get consistent cash flow.. that's what makes it D class or one of the attributes to the Classification of these assets from A to FI call them paper tigers... :)

I would highly suggest that you start down the path of ownership in addition to or vs. being and agent.One of the greatest attributes to a career in real estate is collecting monthly income from the investments you set up.  

Most of the gamesmanship I have heard in this thread attributed to attorneys would get them in serious trouble with their Bar Association, and open them up to Civil Liability and attorneys fees from the investors and landlords here. 

In real estate and in life, Hanlon's razor seems appropriate "Never attribute to malice that which is adequately explained by stupidity".