The problem is now with prices inflated, there is less room to make mistakes.

Other monthly expenses are actually what the seller is currently paying for water, trash and any other utilities.I have been reading about the statewide rent control it looks like you cannot raise more than 5% plus inflation every year, however do you know any information if you can do anything to raise the rent or or ask the tenant to move when you recently purchased a property.

@Warren DresnerI don’t think you’ll be able to reach your goal with the kinds of passive returns that you are experiencing, unless either you get real lucky and happen to invest in a place where values rise 10x or we have a heavy dose of inflation, which would leave the purchasing power of $400k income depleted.I think that you would have to invest in some value added real estate strategy or a more speculative approach.

@Arthur P.I am starting to worry about inflation.

Cap rate and return are unrelated (even if buying with cash).Return comes from cash flow, principal reduction, and appreciation (and tax benefits).Prices are inflated by artificially low interest rates.

As for my location it isn't the time to buy any real estate due to the current inflated real estate market.

Let the banks eat the inflation.

This market is inflated already, so no reason to rush into it.

Maybe companies that purchase their property vs lease and want to get ahead of the inflation for that reason?

You can tell from the price being discussed that it is a zero appreciation market (meaning historically it appreciated no faster than inflation).