Age old question: Cashflow vs Appreciation

[Phillip Dakhnovets]

Hello my friends,

I recently came across a BiggerPockets podcast about Cashflow vs. Appreciation, and this quote by David Greene really stood out:

"Everyone I have ever talked to has always said: Location, Location, Location... buy in the right area, with the right schools... the appreciation you get will trump any bit of cashflow that you thought was important, and you won't have the headaches."

I have experience with both and can definitely say that cashflow is nice in the beginning because it gives you freedom, but appreciation is what makes you wealthy. Appreciation is a bit riskier since it depends on factors we can't always control, such as school levies passing, business success, crime reduction, etc.

In my opinion, it’s hard as a newbie to jump into appreciation properties, as they require a lot more initial capital to acquire. Plus, it’s easier to learn and perfect your processes on cashflow properties because they provide an income cushion for any mistakes you might make.

Looking at the Greater Toledo market, there are obvious cashflow areas, but what about the appreciation spots? If you were to invest $100K+ of your own money into one property, where would you go?

Thank you for all the great replies,

Phillip Dakhnovets
Guardian Property Management & Maintenance