Cash Flow (Real Estate)

Real Estate

Real estate cash flow is rental income minus all expenses including mortgage payment. Positive cash flow means the property pays for itself plus generating spendable income. Calculation: Gross rent × occupancy rate – mortgage payment (P&I) – property tax – insurance – maintenance reserve – property management – HOA – utilities (if owner-paid) – vacancy reserve. Many investors target $200-$500/month cash flow per single-family rental. Cash flow positive properties allow scaling — each property funds itself plus generates investment capital. Cash flow negative properties are speculative bets on appreciation — risky in flat markets. Track cash-on-cash return and cap rate alongside raw cash flow.