5: Cash Flow is Starting to Disappear: Is It Even Worth Chasing?

On The Market

BiggerPockets

News, Education, Business, Investing

4.8 • 858 Ratings

🗓️ 2 May 2022

⏱️ 61 minutes

🔗️ Recording | iTunes | RSS

🧾️ Download transcript

Summary

Cash flow vs. appreciation has been a fiercely fought debate between many real estate investors for decades. Cash flow investors love to tout the fact that consistent rental property profits allow you a life of freedom, while appreciation investors argue that cash flow doesn’t build wealth, it merely keeps you treading water. There’s arguably no better panel to ask about this topic than America’s best wholesaler, investor, and flipper trio—James Dainard, Jamil Damji, and Kathy Fettke. James, Jamil, and Kathy have a view on the appreciation vs. cash flow topic that most investors don’t possess. All three of these investors have bought, sold, and held real estate before, during, and after the great recession, meaning they aren’t subject to the 2020 and beyond “hot housing market” stigma many new investors fall into. They’ve seen what a good, bad, and ugly housing market can look like, and, unsurprisingly, they reach almost the same conclusion. Maybe you’re a new investor, looking to buy in a high-appreciation area like South Beach or a cash-flow crazed, FI-chasing rookie who thinks the Midwest is where it’s at in terms of wealth-building. No matter where you stand on the subject, this episode will give you decades of investing context that should help you make far better returns in the long run. In This Episode We Cover Rent growth, appreciation, and the surprisingly most unaffordable state in the US Cash flow vs. appreciation and which strategy makes sense for which investor stage How to force appreciation so you never have to rely on outside market conditions Why forecasting your market is far superior to trying to time it Whether or not cash flow is too slow of a strategy to build real wealth What happens to appreciation if a housing market recession is on the horizon And So Much More! Links from the Show Join BiggerPockets for FREE On The Market Join the Future of Real Estate Investing with Fundrise Cash Flow vs. Appreciation—What Experienced Investors Know About the Debate That You Don’t What Is Forced Appreciation? Why Cash Flow Beats Out Appreciation in Real Estate Any Day of the Week Connect with Dave and Our Panel of Guests Dave's BiggerPockets Profile Dave's Instagram Henry's BiggerPockets Profile James' BiggerPockets Profile Jamil's BiggerPockets Profile Kathy's BiggerPockets Profile Check the full show notes here: https://www.biggerpockets.com/blog/on-the-market-5 Learn more about your ad choices. Visit megaphone.fm/adchoices

Transcript

Click on a timestamp to play from that location

0:00.0	Buy low, sell high. Very easy to say, but not always so easy to do. For example, high interest
0:07.2	rates are hurting the real estate market right now. Demand is dropping and prices in a lot of
0:12.2	markets are falling, even for many of the best assets. So it's no wonder the Fundrise
0:17.3	Flagship Fund plans to go on a buying spree expanding its billion dollar real estate
0:22.7	portfolio over the next few months you can add the fundrise flagship fund to your portfolio in
0:28.9	just minutes and with as little as $10 by visiting fundrise.com slash pockets fundrise.com
0:35.7	slash pockets carefully consider the investment objectives,
0:39.5	risks, charges, and expenses of the Fundrise Flagship Fund before investing. This and other
0:44.9	information can be found in the fund's prospectus at fundrise.com slash flagship. This is a paid
0:50.9	advertisement. In a frequently shifting market, deciding how to invest can be overwhelming.
0:55.7	You need a partner that has a proven track record, BAM Capital.
0:58.6	They've navigated the Great Recession, COVID, and even the current interest rate environment, delivering max returns.
1:04.4	If that track record isn't impressive, then I don't know what it is.
1:07.4	Bam Capital is a trusted multifamily syndicator with over $1.3 billion in transactions.
1:12.7	Their disciplined investment strategy targets cash flow stability, capital preservation,
1:17.4	long-term appreciation, and accelerated tax benefits. Join Bamcapital's 1,200 plus investors across America
1:23.5	at biggerpockets.com slash bam. That's biggerpockets.com slash BAM.
1:29.2	Using my Berkeley Card Forward Credit card to pay for the stuff I need now
1:32.4	could help build up my credit school for the day I need something bigger.
1:35.6	So buying a set of headphones,
1:38.0	all waits for my workout,
1:39.9	smashed it,
	...

Please login to see the full transcript.

Previous episode | Next episode

Disclaimer: The podcast and artwork embedded on this page are from BiggerPockets, and are the property of its owner and not affiliated with or endorsed by Tapesearch.

Generated transcripts are the property of BiggerPockets and are distributed freely under the Fair Use doctrine. Transcripts generated by Tapesearch are not guaranteed to be accurate.