That makes sense with the cap rates I was coming up with (over 9%).

You have to watch out for properties that hit 1% or higher, but have cap ex and tenant issues.

Cap rates vary from 5% to 10% usually.

Just focusing on the passive income you want to achieve will leave you chasing cash flow which will have you buying properties in worse areas with harder tenancies that seem to cash flow better, but will have large cap ex.Any time someone asks a question about where to invest and it can be anywhere, they aren't ready to invest and are opening themselves up to every pitch in the world on an area.

This needs to happen in the cities with demand and in the cities that have no demand, but only after there's incentive for companies to grow in those cities.If you're a small cap company with less than 5,000 employees, limited debt, then these cities in the middle of Arkansas, Ohio, some other **** state, need to incentivize you to come here and move/create your HQ here.

One of these restrictions is a cap on how much income we can require (max 2 or 2.5 times rent depending on the rental rate).

Virtually any cap ex expense will wipe out more than a years returns. 

During your analysis did you include a percentage amount for vacancy, maintenance, and cap x?

@Jason Wray Thank you very much for this response ..I’ve never sold one of my rentals before feels like I’m cutting off a leg and paying close to 100k for cap gains is really starting to eat at me 😵‍💫Any chance you would be so kind as to send me a link to something in the ballpark of what you’re suggesting this way I can get an idea of area and what this type of property could look like!

I really don’t know how to move forward.I do not see how this works$3800 (rent) - ~$1600 (p&i) -$340 (taxes) - $250 (insurance) - ~$1200 (maintenace/cap ex) - $380 (PM)  - $180 (vacancy) - $400 (water) ~$50 (misc) = -$600/monthin a market that appreciation and rent growth has not historically kept up with inflation.