Quote from @Jed Butikofer: Unfortunately, it takes money to make money.With high prices and high mortgage rates, cash flow is difficult to find and we may not see a return to the 2018 market for a while.

You get a Capitalization Rate (CAP Rate), which equals your annualized return by dividing the Net Operating Income (you had gross in your narrative) by the purchase price.

This is not a great return, but not terrible.As others noted, there are other risks, like having the property insured at full replacement or purchase price, or if the option is 100% seller financing with no money down or very little, versus 20% traditional down payment, this can start to move it into a better investment.

@Lisa AlbrightOne thing to consider is your return on equity (ROE).

Class C properties are considered the riskiest investment, but they can offer good cash-on-cash returns.

You need to understand how to drive the Net Operating Income to produce a good solid return. 

You are not even scooping your initial investment so your cash on cash return is negative.

Even if a title company were to manage the setup making sure all parties are paid, the cheap debt and cash flow would not be enough to be enticing to any investor even if midterm rental could yield a healthy return. 

When you say "we," are you speaking about your business or your personal tax returns, or does your business flow into your personal returns because you file as a sole proprietor?  

This means that you will probably need to pay registration and filing fees in at least 2 states if you don’t buy CA property as a CA resident.Be sure to tell your accountant that you may now need to file non-resident income tax returns in each state where you own property as well.