If not, what are property tax sales? 

Tampa can work, but yes, taxes and insurance are higher and might keep cash flow tight.

NJ has the highest taxes per capita in the country so high taxes are expected especially in Northern NJ.

You're giving up some good tax benefits since you're in the tier of taking itemized deductions.

That said, even with conservative rental income estimates, my living expenses would eventually drop to several hundred dollars less than what I’m currently paying in rent once the house hack starts generating income.I do have cash reserves to weather some rough patches, but the idea of pushing my budget this hard makes me uneasy.

Conventional financing is a great option to get started if you have a W2 job or easily verifiable income and you're financing a 1-4 unit property.

Britt,My firm has evaluated some smaller properties (under $500k) in the past for cost segregation, and it generally does not cost justify moving forward, since the benefits are small, and typically the tax liability on the income is minimal if any.

This has made it an attractive investment for some, though high prices and increasing interest rates are currently impacting affordability.Addressing your specific points:High Taxes: Yes, California has high taxes, particularly income tax.

If your goal is passive income, it's not going to be in New Jersey when you factor in cost to purchase, management costs, and rent to price ratio, but what you can get is steady appreciation.

@Ofir R.Recommend you first figure out the property Class you want to invest in, THEN figure out the corresponding location to invest in.Property Class will typically dictate the Class of tenant you get, which greatly IMPACTS rental income stability and property maintenance/damage by tenants.If you apply Class A assumptions to a Class B or C purchase, your expectations won’t be met and it may be a financial disaster.If you buy/renovate a property in Class D area to Class A standards, what quality of tenant will you get?