Normally I would say you'd be better off with investments. However, in this case it seems like your payments are pretty high and you're almost done paying them off, so selling them and paying off the mortgage makes a lot of sense. $3k a month buys a lot of pinball machines back pretty quickly. Or $200 buys a console that provides 10x the entertainment value for less than 1% of the cost of the pinball machines. Pinball machines aren't really worth owning at home unless their value is stable to some degree, otherwise their cost is way too high compared to other mediums.

If you're going to mock people investing in real estate, could you tell us what would be better? Serious question here, at least tell us what you would do.

If you manage it yourself, then it comes with the territory. Most of the horror stories come from improper screening, like not checking credit scores, background checks, etc. I think most of the people with more positive experiences are hiring that part out. It's not really any different than hiring an accountant or financial planner, some of them are good and some of them are not.

See this example:

You buy a house for $90k. You put in $18k as a 20% downpayment. You then put $30k in reno into it, so you've spent $48k. If you go to the bank and refi, they will go do an appraisal. Different banks have different rules, but a lot of them will allow you to take up to 80% of the appraised value in a loan. So if the house now appraises at $160k, you can take up to $128k out as a loan, paying off the original loan + your $18k down + your reno budget.

It's no different than refinancing your personal residence...if you have a $300k house and you owe $150k on it, they'll let you take out a loan up to $240k on it if it appraises that high.

His post on the strategy is correct. The downsides are that if the housing market ever goes down more than 20% you'll be in the red, and it takes a lot of work to renovate a house (and find deals). It's kind of like pinball buying...if you buy on pinside (like the MLS) you'll rarely find a deal. But if you find the right home owner of a pinball machine (or house) you can get it much cheaper than normal.