Invest in Cashflow or Appreciating property?

[Suzanne Laird]

I've been debating this for so long and I just can't decide what's best. I live in Greater Vancouver, Canada.. Would it be best to invest in a non-appreciating duplex that cashflows well (in Saskatoon or Edmonton- compare to midwest for US folks) or a non-cashflowing detached home in the coastal region of Vancouver area (think Seattle!) where there is tons of appreciation but NO cashflow. We would have to supplement the rent for a few years, but these properties are million dollar homes with great value. I'm so torn. what would you do? We have a decent amount to put in for a down payment (200k) but would stay with the 20% downpayment if going with a cheaper property (400-600k). We want to maximize our money to go as far as possible. Help please!! thank you so much for any responses!!! 

[James Hamling]

I am embarrassed how complicated others are making this, it's actually very simple. 

If the choice is as stated, ALWAYS 100% of the time go with APPRECIATION. 

Appreciation CREATES cash-flow. But cash-flow does NOT create appreciation. 

Actually, most often, properties with cash-flow and low or no appreciation create EXPENSES, like cap-x realization, and thus destroy there cash-flow so one is left with neither. A great example of this is the MFH market today, without appreciation there stuck in a bad way for a long time, until appreciation comes back into that picture. 

Think of it this way:

Appreciation without cash-flow is a SEED. Nurture it, it will grow and blossom into a nice money tree. 

Cash-flow without appreciation is an old-old tree who's done it's growing and what's left, yeah, rotting and dying. No thanks.