You have to be careful about rental property (I learned). There is a high unemployment rate there, not a lot of good jobs. If someone has a decent job, why can't they buy a house there since houses are so cheap?
Stay away from the "south side" of Oroville. It is still many times more safe than the bad areas in Sacramento. However, decent tenants don't want to rent a house in a bad area. 2nd street in Oroville is o.k. but lots of rental properties there. You really gotta be careful. Location...location...location. I would just focus on a really nice area for the little more you may spend. Parts of old town are nice. If you drive up into the foothills, there are some beautiful homes. Just stay away from areas that are concentrated with rental properties in Oroville. There are a lot of them. Trust me..I learned my lesson!