Understanding Cashflow on the Forums

[Andy Vasquez]

Total newbie here. In real estate, it seems getting Cash Flow and Appreciation is the dream. When talking about finding a market that still offers Cash Flow, I am a little confused. Cashflow is dependent on how much you put down, if anything. For instance, I want to only put 5% down and build equity while I live there and rent out in a year or two. Cashflow with only 5% down is very tough, but with 75% down it is fairly certain. Am I missing something? When someone says great area for Cashflow, should I assume they are putting 20% - 25% down?

[Joshua Janus]

@Andy Vasquez Putting 5% down on an owner occupant and house hacking is a great way to lower or eliminate your living expenses! Some markets / neighborhoods allow you to do this and positive cash flow.

When investors are talking about a cash flow market, they are generally talking about 20-25% down as this is the standard for investment properties. While putting down this much down increases your cash flow, you still need to pay attention to your COC to make sure you aren't patching up a hole with your money.