I also think most markets won't see anywhere close 6% cap rates (for single family homes which is what I personally invest in).The questions you get to ask are then:Is the extra 4% worth the hassle of management and lack of liquidity.   

Home mortgage is $3700/month and $500/month extra payment towards the principal.

You are not going to qualify for active and will not get any extra depreciation.

CA doesn't have an extra $30b/$40b laying around to do that, not to mention the additional billion to actually do the project to be build ready. 

-Allocate a portion of your funds toward extra payments on the current mortgage while also setting aside money for a new investment.

Is that available to scale up and if there are investors,  resources to manage that side if the business.I imagine a $60M/year Lending business will need systems in place and more than 1 extra person.

Hey, if you get married you'll be able to shield an extra $250k in capital gains!!

We have been able to get some great deals simply by doing extra research that the average person wasn't willing to do.

If you don't need the extra money at closing and just want to pay off your current loan in hopes of a better rate, you could consider a rate term refi instead. 

Something like a house hack, rent out extra bedrooms in your unit, rent by the room, mid term, short term rent the owner occupied unit on busy weekends (and go stay with friends/family)...get really scrappy.