Benefits of Buy and Hold

[Demetrius Hargrove]

I was reading an article on the Basics of Buy and Hold and i have a question:

If cash flow is not impacted by appreciation/depreciation, does it matter what market I buy in as long as it cash flow positive?

[Allyssa McCleery]

With investing in single families is that you will want to account for at least 1 full month of vacancy in your analysis (more if you plan to use a realtor/property manager to place a tenant because they charge 50%-100% of a month's rent for a placement fee). Make sure you still cashflow with this amount of vacancy. I own a 4-plex in a rougher part of town that I account for 12% vacancy and am still able to cashflow nicely. I agree that more doors alleviates some of the burden vacancy brings. Even with the evictions I have gone through over the past year I was still cash flowing because of the other units. 

Another point with appreciation, you can rely on appreciation if you are FORCING it through renovations and/or improved management. You do not want to rely on appreciation for just holding on to the property, at least not within the first few years unless you are in a super hot market.