Tag Archives: cash flow negative

What is Cash Flow Negative

Cash flow negative is a self explanatory term, implying a negative cash flow, or a condition when the income is less than expenses. It indicates higher cash outflows than the flow of income coming in. In the property sector cash flow negative refers to those property investments where the expenses incurred on the property are higher than the returns it yields.

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Cash Flow Neutral

Cash flow can be positive, negative or neutral. It is positive when the inflow as income is higher than outflow and expenses. Negative cash flow refers to a situation when the income is lower than the expense and neutral cash flow refers to a state when the income matches expenses. In the property sphere, cash flow neutral implies that the rental income matches the expenses involved in holding a property. Since they are equal it means that the rent exactly covers the expenses including maintenance charges, loan installment, insurance, and other charges.

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