In CA, the tax increase is capped at a maximum of 2% so it will definitely be less than 5%.  

I would consider putting that into a renewal lease if you do not have a cap built in.

Expiring rate cap?

Based on the numbers, it sounds like the high origination fees, combined with the 70% LTV cap, are driving up the costs, especially if the lender is being conservative with their appraisal values.

.* Annual limits apply to how much can be expensed, with the 2024 cap set at $1,220,000, and investment limits that start to phase out when more than $3,050,000 of property is placed in service.* Not all property qualifies for Section 179.

Many of these projects derive 50% or more of their overall profits from reversion cap rate assumptions and some type of compression that probably doesn't exist in the current environment.  

but all in all there is little to no appreciation in that area so not really sure why anyone would buy in a market where what ever cash flow you make goes back into cap ex over time like it did for me.

I don't consistently track my cap rate, ROI or net worth which I'd like to do more of.

Thats why I was considering markets which might have lower barrier to entry probably capped at about 300k 

It would mean the costs are financed with the property and it raises your basis cost against future cap gains.