Wednesday, September 22, 2010

Cash Flow vs Appreciation

Here's a simple fact to consider. Appreciation is a feel-good speculative number. It is what might be...maybe...if you can sell at the right time to the right buyer. But you just never know until you collect your check from the title company or attorney how much "appreciation" you really got when you sold your property.

Unfortunately too many speculators and flippers discovered that appreciation can be a negative number as well and can eat your financial statement alive.

Cash flow, on the other hand is money in the bank. Another way to put this is "Cash flow is what is, not what might be"

Just food for thought...

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