Is retiring on $500k in rental properties realistic?

[Account Closed]

I've been thinking of buying rental property for a long time but am just now getting into it more seriously. I've read that 8% is a realistic and fairly conservative cap rate, so it would seem that someone could retire owning $500k in rental property free and clear and live off the income as long as they need (approximately $40,000 per year, while rents could then be adjusted upward for inflation as time goes by). Is this a realistic plan for retirement, and are there any important issues or concerns that I might be missing? I know that there will be repairs needed from time to time of course, and it would seem that a very expensive repair could put a large dent in your income for the year.

Personally, I'm thinking of starting with one apartment building, around $250k, then buying a second at a similar price a year or two after, and have them both professionally managed. I currently have approximately $280k in savings, and if I'm able to keep saving as I have been, I should have $500k in about 3 more years. I don't hate my job, though I would like to retire from it as soon as I am financially able.

Thanks, Dave