Buy and hold - what is a good deal?

[Brad Van Epps]

I have just started my journey in RE investing by reading books, listening to podcasts, and hanging around bigger pockets. I am interested in the buy and hold strategy. I understand some of the simple math on analyzing deals and my cash on cash return on investment. On most of the deals i have practiced on they may not be great deals up front with cash on cash return on investment - maybe less than 7%. However, I know this doesn't account for appreciation, and loan pay down over time. My big question is if it is worth it to take less return (with small, but positive cash flow) early if you plan to buy and hold for the long terms, say 15 or 20 years or more? Thanks for your time. 

[Joseph Cacciapaglia]

A lot of my most successful investor clients do exactly that. When you're buying in good areas where you expect both appreciation and rent growth over the long term, you won't usually find the level of cash on cash return that a lot of the gurus are suggesting. If you're getting 5-7%, and you expect decent rent growth and appreciations, then your total return should be pretty amazing. I have several clients that will accept even lower cash on cash, because their analysis points to rapid rent growth and appreciation in the areas that they're targeting.