@Jordan Townes - Looks like the bank is denying the HELOC because they know that taxes are likely ahead of them and the HELOC would be in second position to the taxes.

Those vacation towns are STR friendly, but Michael is right, a lot of urban areas don't allow STRs in CA.

A lot of other markets 20 years from now could be ghost towns with little demand.But on the flipside, that safety/security comes with lessor immediate returns, as is a normal balance with investments (more risk traditionally equals more short term gain potential). 

I've done this with my properties because I'm well known in my small town and don't want people to know what I own.LEGAL PROTECTION: By placing your assets in an LLC, you are legally separating them from your personal assets.

There are investors in small towns and large metropolitan areas.

My property is set in a small neighborhood in a quiet lake town. 

However you still have the 6% rate instead of the 4% rate which is $9,259.38 which is not the bill amount but than times the millage rate for that area plus any surcharges for trash depending on the neighborhood and town limits.A safe assumption without verifying an address with the county is an effective millage rate of about 500 which means the tax bill should be about $4,629, which is still slightly better than not applying for the ATI and on $187k, 6% is $11,220 and a tax bill of $5,610. 

@Sanil Subhash Chandra Bose To bank with a credit union you will have to become a member meaning you must live, work or worship in the same town as the credit union is located.

You might be able to find some deals in small towns that no one has heard of to get your start, but at best you are limited to one deal at a time.

I've done this with my properties because I'm well known in my small town and don't want people to know what I own.LEGAL PROTECTION: By placing your assets in an LLC, you are legally separating them from your personal assets.