We know good cash flow rentals in many areas in and out of Cal. However, our goal is long term apreciation. We’re 250 a month ahead on three houses, but have made hundreds of thousands in appreciation. We take the equity and invest at a higher rate than we pay on the loan. When you figure in the tax deduction on the loan and the net cost of borrowing, it’s not hard to do. Much like banks do when they give you interest and loan the money out at higher rate.
And over a few years as your investment compounds you’re way ahead of what you are paying to borrow the money.