| Buying property to live in is one thing (deductable interest and taxes). Buying property for investment is something else. In ideal time to do that would have been several years ago, before low interest rates drove prices up.
To get 100%+ financing (cash out) you would usually need buy at less than appraised value (fixer upper, foreclosure, tax sale, etc.). Then you have to be able to have funds available to cover the payments and property taxes. While property values in CA continue to rise, there has already been significant speculation, resulting in a high percentage of homes that are overpriced and not owner occupied. If you intend to rent it out, do you really think rent would cover 100%+ financing?
And being used to inflated local prices, you might be tempted to overpay for something out of state that looks like a good deal, but is overpriced in that area. For example one woman bought a condo in CO for $3000 in monthly payments and could only rent it out for $1200/mo. Because the condos were not selling, the price dropped, and new ones were less than her mortgage.
There are people who make it work, but you have to do your homework and not spread yourself too thin financially. | 
04-23-2005, 06:57 PM
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