Rent - The most important number in a cash-flow deal is the rent. Knowing how much a particular property is worth, as a monthly rental unit, will determine all other decisions, principally, the purchase price and mortgage interest rate. Resources: realtors, local paper, residents/neighbors, fellow investors.

Taxes - Tax information can be found on property MLS listings (easily accessed by a realtor) or you can ask the seller how much she pays each year.

Insurance - The cost of insurance can be found by asking an insurance company for a quote on the property. One can also use empirical data from other properties or ask a fellow investor for an estimate.

Utilities - The best way to know the monthly cost of utilities is by asking the seller directly.

Property Management - Acquiring a property manager is optional. Investors who decide to use a property manager must take this cost into account because it can considerably diminish profits. Property managers range in price, but the average cost is 6% of your gross rent, cutting into your cash flow total.

Vacancy Expense - As a conservative investor, one must take precautionary measures and assume that the property will not be occupied year-round. An investor should account for a "vacancy" expense of 3%.

Our Cash-Flow Data analysis form takes all these costs into consideration and allows for a monthly profitability snapshot. It is broken down into best-case and worst-case scenarios (we advise to use worst-case scenario numbers). Plug in all of your numbers and determine if the cash flow is right for you. Remember it is better to be conservative with your numbers, so overstate costs and understate rent rates.

With greater reward comes greater risk. There are three major factors to consider when analyzing a flip: a) purchase and rehab costs, b) carry costs between the purchase and sale of the house, and c) your expected profits upon selling the property.

Rehab Cost - The best way to get a rehab estimate is by having a contractor give you an estimate (assume it'll cost more). This will help you understand how much you can buy the property for and can help in purchase negotiations.

Closing Costs - Closing costs tend to vary from deal to deal, but a safe bet is to factor in 6% of the purchase price.

Carry Costs (resell) - Carry costs are crucial because you lose money for every unanticipated day. To access a timeline, get an estimate from your contractor on how long the rehab will last and ask a realtor how long similar properties took to sell. You must pick your mortgage wisely and know exactly how much the loan will cost you. Before putting the property officially on the market, one must know it's comparable (how much the last compatible property sold for). This is often different from the appraised value of the property.