RE is really a small business and the number 1 reason that small business's fail is lack of proper capitalization..

Spend more than half of your total working hours in an RE business in which you materially participate.2.

You're running a business and want to just make money.

Regarding finding discounted deals......That is the reason why I started a wholesaling business. 

The new people don't know and they are the business target.

I am a twenty year plus licenses GC who has built over 100,000,000. in commercial and residential construction in the NY, NJ, PA, CT and CA marketplaces.

I also see your point about avoiding bargain basement properties, especially insofar as tax shielding is easier with an asset of a reasonable size.Your point about barriers to entry is also interesting, since I suppose those barriers can be geography (natural boundaries of mountains/water), but you're probably referring to that which impedes future construction?

The local economy seems to be centered around these types of businesses. 

Is the mid term rental business that you have a 'rental arbitrage' business?

Similarly, quality dividend-paying companies often retain some earnings to reinvest in their business, increasing the company's (and your) value over time.