For most investors, cash flow is the most important consideration when it comes to an investment property. In fact, usually it’s the most important factor.
So how much cash flow should you be looking for in an investment? That depends! While many investors look for properties that will generate at least 1-2% of the purchase price each month, the right amount of cash flow for you will depend on your investing goals and criteria. It also depends on other factors, such as appreciation; how much the investment is expected to appreciate in value over time.
In this article, we’ll take a look at what exactly cash flow is, how it’s calculated, and what you should look for when assessing a potential investment property.
What is Cash Flow?