., you're looking at negative CF...probably for life. 

If the Landlord/Owner pays for it out of the rental income, then include it (i.e...taxes, insurance).2 - Cost Recovery:  Divide the Down Payment (plus any other CASH ONLY costs that come out of the Landlord/REI pocket, i.e....repairs, vacancy costs, added payments towards the principle made by the REI, negative Cash flow) by the yearly Cash Flow. 

To me, the best option is one that isn’t cash-flow negative to your financial situation the first few years as you get started.

You are basically breaking even, and if something big happens he could be in the negative.

I keep getting a negative cash flow!

Just remember: most negative reviews are written by problematic tenants.

@Kyle Fanene depends on what you are looking for, if you were looking in Phoenix you might as well look nationwide, if you want to stay local you have to know how much negative cash flow you are willing to accept or how large of a down payment you are willing to accept for positive cash flow.

I might change my opinion and could be wrong but right now with the global chase for yield, QE, and a demand from the president and others for 0% or negative rates in the US I don't see how hard assets like real estate will decompress anytime soon.

Many properties I see (SF Bay Area) would be cashflow negative at purchase even just on PITI and not accounting for repairs, capex, etcReal estate in California has always appreciated, but its not always just a straight line up, like any market there are peaks and troughs with a general trend line up.

Positive or negative..... at all.