@Amy Jo Holweger I’d say 200 bucks a month is fair after accounting for PM, mortgage, repairs, capex insurance and taxes 

I'm local and fairly active in the Real Estate Market. 

Here are two quick and dirty ways: for the lowest interest rate get a HELOC on your home.Since it's a 5 unit you're facing commercial rates and are playing in the big leagues of financing which means you need a seasoned entity combined with personal guarantee for the lowest possible interest rate.You can buy a seasoned entity online (make sure it's in the same state) that has a 80 or higher credit score, move the entity to the property address, change all the credit lines to the new address, transfer the property into it, and get your credit score to 720+.Apply for a commercial loan if you don't want to go the HELOC route.

Why would you ignore that while putting all your eggs in one basket.I would put $100K down on a 2-4 plex, $100K into 3% CDs and gold stocks to weather this trade war storm (2018), and put the last $100K into my own business as a LLC that could be used in Year 3 to play in commercial real estate (5 units or more).In the mean time shoot for a 80+ business score and 720+ personal credit score while seeing if we're heading into a recession.

@Candice Banks I think you will be able to rent one of the rooms fairly easily. 

I like that play the best personally.Unless you make an offer on the note that is just too good to be true or a screaming deal.. then you can do all the work it takes in that state.. it was an eye opener for me to do the one I did and it quite the process ..

Brush up on what you learned while playing politics while running for middle school class president, get on the HOA board, and fix it.

I also don't find it fair that after you pour all your hard work into a property, improve it thus improving the neighborhood, that a law can be enacted that controls what you can or can't do with that property. 

Obviously there are several issues at play here, as not everything is a true apples-to-apples comparison and it's quite possible that many of these units are rented to family or long term renters, but the discrepancies are off by often $700-1200/mo. 

I understand the California markets are generally considered appreciation plays whereas the out of state markets can offer better cash flow; I'm still trying to figure out what works best for my situation.