There is a huge difference between our market now and the money built by "insane speculators, Inc" in 2004-2006.

In markets where home values are higher and rents have not kept up it is impossible to experience that much cash flow.Then you can't own rental properties there except as speculation.

That's something of a speculative investment choice, IMHO.

If we add that $14k to the after-tax cash flow, we are left with an all-inclusive after-tax return of 22.4%.In this example, we assume the value of the property will not go up in value one cent — which is smart because assuming is another word for speculating, and speculating is risky investing.

If you buy this property, I see this purely as an appreciation speculation play and personally I don't think it is worth it. 

A is completely safe, but usually not great for investing due to higher prices.There it is again, the California view.By that definition, every single place I own is D, 7/8 of greater Pittsburgh is D, and anybody who lives in the actual city proper has to settle for D unless they live in the newest multifamilies being constructed as infill by speculative syndicates.

Jon,True...I excluded property appreciation becuase it is somewhat speculative, but historically I believe its around 5%...if we factor in 5% appreciation per year, this would make his properties worth $815k after 10 years or a $315k appreciation - 15% capital gains = $273,915 net gain/10 years (not sure if thats correct tax rate) in values or $28,000 a year in property appreciation...Assuming property appreciation, the renter would be on top...

Our strategy is based solely on making sure the profit is made at the time of purchase and not on speculative appreciation months or years down the road.

Sell it and get something else that brings money in so you can grow.If you are in a stable job that you love and you are looking more towards retirement and you believe there is still plenty of "up" left in your market, then maybe stuffing $700/month into the property as an investment makes sense.I personally do not think it is a good idea to speculate on appreciation, but it can be very lucrative.

The only potential cash flow you can get there is with appreciation, but that's a waiting game and essentially speculation (while losing money every month along the way).