What's really important in analysis?

[David de Luna]

I own rental property and am actively looking to continue to invest in multifamily. If Fidelity has been paying my wife and I about 12% AVG return, then my reasoning has been that - as an example - if I have $500,000 in retirement savings available that now pay me a return of 12% or $60,000 annually or $5k monthly (21%+ some years, -2% others, but 12% is the avg), and I wish to move that amount into buy and hold, the only motivation to do so must be that the deal is going to pay me better than 12%, or why bother? I'm checking in with you on my logic.  For me, as a buy/hold investor, it would seem to me my number to look for is the cash flow and the COCROI. Maybe I'm missing something. Feel free to correct erroneous thinking.

So, correct me if I'm wrong, but the COCROI is the comparison number, without adding in everything else - appreciatian, tax considerations, etc, right?

COCROI for Yr 1 is easy enough formula to write. Isn't there a more elegant way to write a formula to get the TOTAL return, including appreciation, then the way I'm doing it here? If so, can anyone suggest something?

[Aaron K.]

@David de Luna this is tough to do because with Fidelity you are including appreciation and dividends, you would need to do the same for RE, even cash flow is the wrong metric to compare to dividends, because as you pay down the mortgage a portion of every payment goes towards increasing your equity.  You need to account for cash flow, appreciation, mortgage pay-down, and tax advantages to make it a fair comparison.  In any respect don't put all your eggs in one basket and stay diversified.