Piece of cake and pretty much 100% accurate.

Appreciation is icing on the cake. 

They are ordinary income and you've likely got a bit of a struggle on your hands to work this through.You can absolutely set up retirement plans based on your flipping income, even if you're flipping with partners, but you're in a situation where you're trying to have your cake and eat it too.If you are really going to insist that your flipping is capital gains (it's not, but let's say it is), then no - no retirement contributions because retirement contributions are based on EARNED income and capital gains is PASSIVE/INVESTMENT income. 

The appreciation is the icing on the cake.  

Still, real estate is different in that shelter is a necessity (versus say me selling pies, if I charge too much you can always buy cakes instead), which means that invariably government will be motivated to get involved.

Yeah, as we know, "appreciation is the icing on the cake", but sometimes the icing on the cake is so thick investors go for it. 

This ensured he got his price and the interest was the icing on the cake. 

Appreciation will be low, and it would be harder to sell when / if the time comes (again, people point to that often times cheap houses sits on markets for months at a time, versus in seattle it sells like hot cakes)Upside of local investment is that it appears “safer” - I know the market, I can drive to it to make sure no one “Morris”ed me, and when the time comes to sell / 1031 - hey, it’s easy, and it most likely will come with good appreciation (I know, appreciation is not guaranteed; it’s icing on the cake).What would you guys do?

If it makes it seem any worse, then we didn't find this out until AFTER I had let him go (in other words I let him go for other reasons but then found out he lost the key as the icing on the cake).You might just be right about having me eat the cost of the key now (I was going to re-key when she moved out anyway).

However, I view appreciation as icing on the cake.