Buying a vacation rental w little cash flow month to month

[Michael Otoole]

Let me know your thoughts on this statement:  A vacation rental property could have negative monthly cash flow but it could appreciate at a high rate in which case it would still be a good deal for a long term investment.

I can’t seem to find many properties that have a huge monthly cash flow return but I have found some that pay for them selves and make a small amount of cash each month but the property values appreciate over time and thus make the investment still a good investment. Has anyone else found this to be the case?

[Julie McCoy]

@Michael Otoole Relying on appreciation is always a gamble.  You can find better odds in some areas than others, but there is never, ever a guarantee of appreciation.  

A vacation rental should absolutely have a significantly higher cash flow than a long-term rental - the amount of money and time invested in a VR is much higher than a LTR, and cash flow should increase accordingly; if it doesn't, move on to another investment, because what you're looking at isn't a good one.  

I have four VRs that cash flow like mad; it can most certainly be done, you just have to find the right market.