Landlording for Cashflow or Appreciation? (in expensive markets)

[Justin Koopmans]

Hey BP!

Got a couple off-market deals I'm considering in Northern CA but I've got some "newbie" dilemmas going into them and it's this - these deals seem like great deals (like $50k-$100k less than what they are worth) - but even at these discounts they do NOT cash flow after accounting for repairs, management, vacancy, etc (they do "cash flow" in that it covers the mortgage and has a little bit left over... but that's obviously not true cash flow). 

I understand that I could purchase these homes and flip them for profit but that's not my game plan (nor would the seller sell to me if that was my strategy). I'm seeking buy and hold rentals. Other buy and holders in Northern CA and similar markets - are you content with a deal like this where you're in the hole $300/month with the long term vision of either increasing rents or selling in the future for a big payday? 

Part of me feels dumb not to jump on the deal for the equity but the other part looks at the numbers and wonders why I would buy something that puts me negative $300/mo haha!

[Joe Villeneuve]

Depending on future events to fix a problem isn't investing...it's speculating. REI isn't about buying properties, it's about moving money through a property, in the front and out the back, and when it comes out the back it comes out with "friends". If you are unsure of how many (if any) new friends your money is going to make, but you are sure you are going to lose friends in the process, and the goal is to make as many "friends" as you can, why would you...

How the meeting room where you are supposed to make these new friends looks isn't important.  What matters is how many friends you can make.  If you can meet at a less expensive meeting room, with the same amount of money to spend on meetings, and make more friends through volume, why would you...