cash flow or built in equity?

[DJ Cummins]

How do you decide what property to purchase?  There are two properties for sale.  One  is fully rented and will cash flow around $300 per month.  The other property is not currently rented but can be purchased with 10-20k in equity built in....and some cosmetic updates could raise that a bit more. 

Without getting to technical with the figures on this vague example, which would you choose and why?  

[Chad Hovermale]

If the equity option doesn't cashflow, then I would pass on it.  You can't use equity to replace the furnace or buy the next place.  It depends on your goals,  your current balance sheet and cashflow, tolerances, skill set, and lots f other stuff.  But... cashflow.will cover your butt more often than equity.