This can have massive effect on cash flow, let's say:Total Income:                                $900Expenses (not inc. mortgage):     $451.43Taxable Income:                      $45020% Tax:                                 $90(There is a tax relief on mortgage interest of up to 75%, for simplicity I did not factor this in)Total Expenses:                       $687Monthly Cashflow:                   $212- $90  = $122Annual Cash Flow:                   $1,464Total Cash Flow after 10Years $14,640       (nearly $11,000 difference) Profit on sale (not inc. tax) $16,370Total Profit:           $31,010 after 10 yearsThe same amount of money in a stock that pays a 5.6% (tax-free) dividend compounded would be worth $58,630 (not accounting for appreciation) Profit: $24,630 Buying, renovating and selling a house seems like a lot of extra work for $638 a year. 

Every direction you turn there are condo buildings being thrown up.I've had the privilege of living in this great country for the past 3 years.

Also remember that you're not exchanging the amount you brought into Colombia but the amount your taking back to the US thats compounded at 30% clip.   

I feel a lot of people in our age group tend to spend every dollar they make on status items rather than focusing on building wealth.In terms of considering buying yourself a house or totally investing it, I would say it is probably smarter to just invest the whole amount and then compound it like you said.

A second vote for annualized ROI, although I use a non-compounding approach.

He advises that you have them sign something that acknowledges that they are paying more for the privilege of making their financial planning easier...you don't need drama over someone figuring out they are paying more after the fact.

And, for that privilege, they get to inspect and find ridiculous things for you to fix!

By the time you figure in condo fees, taxes, insurance, vacancies, CapEx, special assessments, and repairs, you're probably going to pay $800 a month on average for the privilege of being a landlord plus what you pay upfront.

On the other hand it gives you certain privileges e.g access to the mls, forms and usually through continuing ed should make you more familiar with real estate laws.

(simple interest)72/7.2=10 compounds (years in this case)But if you got a lower interest, say, 3.6%, it would take 20 years for the same 50k to cost 100K. 72/3.6=20Now the numbers are not "hard" or "exact" but they are fast...And when your using money manipulation when negotiating, odds are that the other guy doesnt understand the value of compounding, atleast the way you do now.