An investor who invests in a property with an 8 cap return for a hypothetical amount of $1,000,000 will earn $80,000/year in cash flow. I

The 8% return provides the investor a strong return which is about equal to the 8.4% return for stocks between 1990 and 2008. However, the overlooked aspect of the investor's return is the appreciation of the property.  The property's value will likely increase at at least 5%/year over the long term. If the investor holds indefinitely, the property owner is basically receiving a perpetuity in the amount of $50,000/year. At a conservative 10% discount rate, this appreciation factor itself has a NPV of $500,000. That means the value of this investment is $1,500,000 whereas it's only being valued at $1,000,000 based on the cap rate (the cap rate seems to provide a sufficient return on its own that justifies the $1,000,000 investment value.)   Why would someone ever sell a property and give up the appreciation perpetuity that comes from "buying and holding" indefinitely?

The above analysis is an un-leveraged scenario which also doesn't even take into account tax benefits.

Am I missing something? This seems too good to be true and I can't understand why anyone would ever sell? Why isn't the appreciation factor taken into account when valuing real estate?