Dangerous but you could pull it off if nothing terrible goes wrong.

I've anecdotally thought this, but never studied up on it so couldn't speak to it.I remember this happening in the 80s, with folks just walking away from their ARM loans and was watching closely (and nervously) before the last crash because more and more people seemed to be getting loans that seemed dangerous (either they were ARMs with a big bubble, or loans that people couldn't afford, etc).David, I'm going to read that book and the Wired article.

And frankly, relying on past appreciation to solve current problems is a yellow-ish flag.To me, the worst thing that an investment can do is cost you financial security, and it feels like you're potentially in danger of that happening.So, if I'm in your shoes, this is a no-briner.

RE is local and it should not be assumed that every area has properties available at pennies on the dollar.If you have a good rehab crew, check with the city and ask for a list of properties on the dangerous building list.

One local city extended its ETJ (extra territorial jurisdiction).

Emphasize over and over to the tenants that they are to call you whenever something needs to be fixed.It comes with the territory.

Sierra Vista is outside of my normal territory, so you may just want to google "Sierra Vista Short Sale Realtor" or something similar and see who pops up and interview a few.

A man who does not understand his limitations is a dangerous business partner.  

This doesn't make it a bad investment providing everything pans out long term but we think paying above retail at the time of purchase can be a dangerous way to invest.

Bill has also mentioned many times on BP that following old gurus in areas of financing is plain dangerous as new finance laws are in place.