Hello BP'ers,Today, another monthly inflation report came out, the nations December CPI. 

This is because rents are a significant part of the inflation metric that the Fed looks at.The market is good for lenders, but it’s a different story for investors.

Long term I can see Milwaukee home prices creek up to the national average, which probably means they will double over the next 10 years, partially fueled also by inflation (devaluation of currency).You could try and BRRR on the fringes of that gentrification, which should work in theory, but you already need a fair amount of comps over 200k for it to work and a "good neighborhood feel" - I have not seen it done yet and the risk is of course that you don't see the same rate of value gain as you see in desirable communities..

property value have soared and do not seem to be dropping even with inflation and higher rates. 

The only thing I use cap rate for is predicting the future exit value of the property by using today's market cap rates and inflating them for a time adjustment. 

I get inflation might have something to do with the increase in monthly charges but I'm sure its still going to continue rising.

Then I retire from W2 job, drop down several tax brackets, and enjoy the cashflow and pay my (much lower) taxes, and let my eventual depreciation recapture disappear with inflation over time (or never happen if step up basis holds).

Right now I’m bouncing around 3 ideas:  1) Local BRRRR for a single family home 2) Vacation STR within 2-3 hours drive or 3) out of state multi-unit since prices are so inflated in the DMV.

REITs have been a favored investment class for this reason, and have experienced the same kind of inflation we have seen in stocks - not so much a result of value, but due to demand since there are few alternatives.  

Deals were easy to find, numbers made sense, even in markets that are now completely over inflated (like San Diego, I was lucky enough to do well in that market as well).