Don't forget the other expenses of being a homeowner over renting: property taxes, insurance, water/sewer, repairs/maintenance.

Thanks If dad wants to take it out, it would be taxed. you can convert it to Roth but it does not make sense as you will pay taxes on the conversion. 

And CA can only raise taxes on people so much to make up for all that lost tax revenue from those fleeing businesses before they all move.  

I appreciate the response.I do have a couple of follow up questions.One of the big concerns is the high property taxes.

Assuming your prediction of increasing values is true, that will also increase your property taxes. 

Low property taxes, landlord, friendly and restricted building. 

I have constantly under estimated the cost of escrowed taxes, insurance and the such.

Between risk, tenant hassles, vacancies, mortgage payments, property taxes, insurance payments, replacing a roof, water heater and so, it takes a lot of appreciation to actually get ahead on that.

Some major pending (and potentially retroactive) tax law changes made it through the house. 

I am new to tax surplus and I want to know how legal is it charge 30-35 % finder fee especially when the "state" puts a limit on unclaimed property of 10%.