I actually think your views are somewhat misguided. Here are a few reasons: (1) you are looking at residential properties (1-4 unit dwellings, and likely just single family households) which should not be considered "real estate investing". The idea behind this, which is shared amongst the commercial real estate community, is that you should purchase a home you can afford that fits your needs, lifestyle, and wants because it more often than not is going to be an emotional based purchase. (2) Actual real estate investing is done in the commercial and industrial sectors as you're adding value to properties, decreasing vacancy, or optimizing operations (NOI). Yes, there are many investors that focus solely on single family (residential) properties but it typically attracts "want to be" investors. (3) investing in residential properties to rent by bedroom or house is usually not going to lead to significant ROI as you will be tying up your capital for insignificant rent that you could otherwise invest in a treasury and make the same amount with less risk.
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