Also keep in mind your talking about B + to A inventory IE meaning very nice owner occ neighborhoods and or new construction. there are plenty of houses but a huge amount of them are in areas that ONLY attract investors they do not attract owner occupants..there by making this shortage even worse. 

You have to know where to invest and how to buy but my owners are making plenty of money there.

Yes home prices are way up but so are rent prices and occupancy rates.Still plenty of cash flowing meat on the bone in the same markets there always was.

Plenty of crappy houses to buy but all over priced and crawling with investors.

I didn’t have much for savings/retirement and lots of debt, yet I bought 2 sfh in the first year while making plenty of offers for another.

Then one day a friend invited me and a couple others to lunch and we talked investing the whole time.

Today I invited him to my Thanksgiving dinner. 

I agree with @Caleb Brown, you have plenty of options in your financial position!

That's inviting to families visiting with kids.He highlighted an inviting outdoor space.

She has recommended us considering in-state investing, but we are nervous investing in CA given how renter-friendly it is.Our philosophies for starting now are 1) we want to achieve financial freedom/escape the 9-5p in our 40s by building a strong passive income real estate portfolio, 2) we want to start gaining experience now/we've only heard anyone's regret ever being that they wish they started sooner, and 3) we sense that if the math works, the math works (and not with rosy numbers, but with very realistic numbers with plenty of risk baked in like vacancy, maintenance cost emergency fund, etc)Thanks, really looking forward to some constructive feedback/conversation!