We all have our own comfort zone as to where/who you want to rent to. Some people are fine w/ being slumlord and others prefer more white collar professionals. There’s no right or wrong. You probably will cash flow better being the slumlord, but that comes w/ risk. Higher risk, higher return. So, in order to give you a better pointer, you have to give a little more info. What kind of tenants you’re shooting for. Are you counting on appreciation or purely cash flow.

With that said, timing is also very important. Right now, I don’t think you can find many properties that can cash flow (assuming 20% down), unless you go to less desirable areas. Areas where the majority of the tenants are white collar tend to only break even or run at a slight loss. 2-4 years ago, it was much easier to find places that cash flow with only 20% down. I’m not sure if we’ll see those time again.

I like Mira Mesa, Racho Bernardo, Rancho Penasquitos. Basically places that are near high tech hub of Sorrento Valley and Rancho Bernardo.