Cash Flow vs. Appreciation

[Brian Chan]

Location A: Positive Cash Flow + 4% Appreciation each year (as such locations which the 1% rule apply)

Location B: Breakeven Cash Flow + > 4% Appreciation each year (locations with higher appreciation like Austin and SF Bay Area)

In your opinion, would you seek higher appreciation if you can find break even cash flow properties? Or you would rather seek positive cash flow with high Cash on Cash Return? 

[Ken Naim]

@Brian Chan it depends on whether you need/want the cash flow to live. If you have plenty of cash reserves and other sources of income then appreciation could be better as it is more tax efficient. Personally I'd go for the highest total return.