Many real estate investors will argue that 'cash flow is king', but many never consider why this is the case. When it comes to considering cash flow and appreciation in your investing, it pays to consider the role that both of them play. They do not exist in isolation and they share a relationship. I was recently listening to a Bigger Pocket's podcast when I heard Brandon Turner, David Greene, and Robert Jones discuss how these two work together and which one will really give you wealth.
The discussion was focused around the argument that 'cash flow gives your freedom, appreciation gives you wealth.'
Cash flow is very attractive to new investors because it can provide another income source outside of your 9-5. Yet no one reaches an incredible level of wealth based off of cash flow alone.
Also, buying cash flowing deals will often come at a price of not having more expensive and desirable real estate appreciating.
Cash flow allows you to stay in the game and ensure you keep playing, while appreciation is really the big picture.
As Robert Jones said: "You should always analyse a deal based off of cash flow, never bank on appreciation. Appreciation is just the icing on the cake, but the icing is pretty thick..."
Thanks for watching!
___________________________________________________________________________________________________________________________________________________________________________________________________
The Bigger Pocket's Podcast:
MY FAVOURITE INVESTING BOOKS:
A Random Walk Down Wall Street by Burton Malkiel:
Rich Dad's Guide to Investing:
Rich Dad's Retire Young and Retire Rich:
Rich Dad Poor Dad:
Rich Dad's Cashflow Quadrant:
The Richest Man in Babylon:
0 Comments