Updated about 3 years ago on . Most recent reply
Agree or disagree....
Investors should be focusing on appreciation and not cash flow with rentals in this shifting market...
Most Popular Reply
I disagree.
In single family rentals, what can you do to change the level of appreciation? Nothing. You are at the mercy of the market, and in turbulent times, it can take a long time for a market to shift in the right direction.
Those buying zero or negative cash flow properties may not realize how much risk they have created for themselves. Lose your job and have an AC go out. Now you have no cash to fix the AC so the tenant moves out. Now you can't pay the mortgage, and soon the whole house of cards can come tumbling down.
If you have cash flow, your business is self sustaining and can take a hit like a down AC unit. Appreciation will eventually happen everywhere. I like knowing my portfolio will survive to see that day.
In single family rentals, what can you do to change the level of appreciation? Nothing. You are at the mercy of the market, and in turbulent times, it can take a long time for a market to shift in the right direction.
Those buying zero or negative cash flow properties may not realize how much risk they have created for themselves. Lose your job and have an AC go out. Now you have no cash to fix the AC so the tenant moves out. Now you can't pay the mortgage, and soon the whole house of cards can come tumbling down.
If you have cash flow, your business is self sustaining and can take a hit like a down AC unit. Appreciation will eventually happen everywhere. I like knowing my portfolio will survive to see that day.