It's also important to determine your own acceptable level of risk.

I concluded that owning a large asset in LA would be more beneficial to my net worth over time than buying several small properties out-of-state -- and I think I was right!

I've purchased several properties that were more "turnkey" and wanted to try my hand at a true fixer-upper.

Because of the wildfire risk, options were extremely limited.

I’ve rehabbed several homes in Austin and in the middle of a rehab in SW Austin currently.

It was one of several tax mitigation strategies we were using.

It is some extra leg work on the front end, but now I have quality tenants in a home for several years now with the expectations set to maintain the property in an appropriate manner or they are out.

I think the risk here is minimal.

@Brian Ciuchta I am working on several ground up deals that are exactly what you are discussing. 

This raises risk and will result in rents rising faster than CPI due to tenant turn over.