If the COCR shows infinite, it is because your out of pocket is zero, or actually negative, if your numbers and assumptions are correct, and it still shows infinite, then you have a great deal.

However, the cash on cash return on this deal is INFINITE because you have no cash in the deal.

As you can probably see from all the comments here, there is a nearly infinite of ways to invest in vacation rentals.

I personally find the Series LLC to be a great tool for the individual investor who is planning to expand their operation, as it allows for you to scale infinitely - check out this article to learn more.

Your return on cash can be extremely high to infinite.  

If situation allows, wouldn't it be better if we down as little as possible preferbly $0 down which will makes the ROI infinite instead of 20 - 25% down?

@Scott LoudI do this whole life insurance thing, and some folks call it "infinite banking."

Of course if you are able to get a better return from appreciation and rents in certain "booming" areas, but of course this trend is never infinite.

HI All,So I am shopping around for my first deal and find myself wondering if it is better to pay cash for a small (2-5 units) multi-family property and get infinite cash flow or take out a loan for a larger property and create equity. 

That compounded by the fact that there is no limitation on supply, the land seems infinite to develop.I'm not in this for quick liquidity reasons, but do people have concerns about even selling in 10 years from now - the supply just seems to be over the top.