Welcome to passive real estate investing, the show where busy people like you learn how to build substantial passive income while creating wealth for the long term.

And now here's your host, Marco Santorelli.

Hello my friends and welcome to another episode of Ask Marco

where I answer your investing related questions.

Today's question is a great one and it comes in from Kramer and he says,

Hey Marco, quick question for you. It's really more of a viewpoint that I'd like you to

address for me. Maybe there is something I'm not seeing or considering.

If I'm going seeing or considering.

If I'm going to buy a $100,000 investment property where I have to put $20,000 of my own money down

for it and my cash flow is going to be around $200 per month based on several properties listed on your site.

I'm having a hard time getting excited about that.

It would take just over eight years to recover my initial investment through the property's cash flow, in quotes.

More to the point, I'm having a hard time considering it cash flow when I already had $20,000 in my bank account.

Does that make sense?

It reminds me of the concept of an annuity except I'm not earning interest unless I raise

rents every year, but even then how much can I reasonably raise rents without losing

without losing tenants. It seems like the real reward or gain comes from the price appreciation

and equity accumulation over time,

which I could then use to either cash out for a

windfall or 1031 for more property. 1031 being the tax deferred exchange.

Perhaps at that point the cash flow would seem more attractive.

Is this about right or is there something I'm missing from the concept of the near future cash flow.

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