If you were to think about Real Estate Investing (REI) as a 3 course meal, Cashflow would be our appetizer, Mortgage Paydown would be our main course, and Appreciation is a sweet little treat (usually only enjoyed at the end of an investment or at refinance.)
Cashflow is the amount of money remaining each month from an investment property after paying all the monthly expenses from the rental income. Why is it so important? It is important because, this is a rental property so the tenants are the ones working hard to deliver the passive cashflow to you! Cashflow is what allows you to achieve your goals + the lifestyle you desire. Ontario Assets captures extra cashflow through using the buy, renovate, rent, re-finance and repeat (BRRRR) strategy or by maximizing the houses square footage as a Student Rental.
By using creative strategies we can not only achieve forced and market appreciation, but we focus on maximizing the cashflow for the property. There is no need to worry about trying to carry a negative cash flowing property while waiting (and hoping!) for values to increase.
Cashflow however is just the beginning! A main benefit in REI is realized by someone else paying your property’s mortgage for you. Mortgage Reduction is occurring through the same tenant mechanism; by way of their consistent, structured payments into your investment properties.
Last to the table is Asset Appreciation. This delightful addition however is often outside of an individual investor’s control, unless utilizing a BRRRR-type formula. In solid economic environments, appreciation is constantly occurring which is sweet but not guaranteed.