(hint, it's all about future values, both rent wise and appreciation wise.)That's why the market is so competitive in LA for 2-4's...The future value of a property or rent will not rescue you from a foreclosure if the present rental income is insufficient to cover the present mortgage and expenses and you do not have sufficient extra funds to cater to the deficiency. 

And even though they have the same square footage, missing that extra bedroom is a big deal.

I'm betting that some SoCal landlords/homeowners will get burned--or should I say flooded--come El Niño, finding themselves in a bind they don't have the cash on-hand to get out of, and may be willing to part with their properties quickly to a ready cash buyer...or maybe I'm just dreaming.  

Three 3 bed units, three 2 bed units and 2 units with either extra large bedroom or a spare room.

I agree the extra $ is worth it to work with closing folks you know!

Was wondering if this is the best route to go or would it be better to use extra money to give me and my wife's ira and 401k a big boost.

they raised ours to $85.00 /Yr to pay for extra police presence. 

Thanks Chris,I completely agree and I appreciate the extra insight!

Should I invest more money in the Kitchen or an extra Bedroom.

If you were the tenant, would you feel it was fair to pay extra for something that you didn't cause?