Do you include principal paydown in return?

[Karen W.]

Do you guys count principal pay down when calculating your return on investment?

[Mike Dymski]

Profit in real estate comes from cash flow, principal reduction, and appreciation/depreciation. Ignore one or more and you can't properly benchmark investment alternatives and the return on your personal capital. There are very profitable investment strategies where principal reduction and appreciation are the only components of profit. IRR will capture all of the cash flows on a property. There are lots of ways to tap into equity created through a refinance, sale, or exchange. Lots of my way or the highway strategy bias on BP.