When investing in real estate, consider factors like location, property condition, and potential rental income. For example, if you buy a property for $200,000 and rent it out for $1,500 a month, that's $18,000 a year in rental income. If your expenses (mortgage, taxes, maintenance) are $12,000, then your profit (cash flow) is $6,000 per year. This gives you a rough idea of how your investment may perform. It’s important to calculate these figures carefully to ensure you’re making a sound investment.

Cash Flow is the net amount of cash being transferred in and out of an investment. In real estate, it refers to the total income from the property minus all operating expenses. Positive cash flow is essential as it allows the investor to cover costs and potentially reinvest in other opportunities.