The One Number Every Real Estate Investor Must Know Before Buying a Property
Walk into almost any real estate investing event, and you'll hear the same conversations.
"What's the purchase price?"
"What's the ARV?"
"How much equity is in the deal?"
Those numbers matter—but according to real estate investor Johnoson Crutchfield, they're not the numbers that determine whether you'll actually make money.
After buying more than 200 properties over the past decade, John says every investing mistake he's made can be traced back to ignoring one simple metric:
Net cash to you.
If you want to build a portfolio that creates wealth instead of monthly headaches, here's why this single number should guide every investment decision you make.
Quick Takeaways
What Is "Net Cash to You"?
Net cash to you is exactly what remains after every expense has been paid.
That means accounting for:
- Mortgage payments
- Property taxes
- Insurance
- Property management
- Vacancy
- Repairs and maintenance
- Other operating expenses
What's left after all of those costs is the money your investment is actually generating. That's the number John believes matters most—not the purchase price or the projected value after renovations.
Investor Insight
A property doesn't become a great investment because it's inexpensive. It becomes a great investment when it consistently puts money in your pocket.
Why Purchase Price Doesn't Tell the Whole Story
Many investors get excited when they find a property selling well below market value.
It feels like an obvious win.
John shares an example from his own portfolio.
He purchased a property for approximately $220,000 in an area where similar homes were worth more than $550,000. The home required only about $30,000 in repairs, making it appear to be an exceptional deal on paper.
By most traditional investing metrics, it looked like a home run.
But there was one problem.
He wasn't focused on net cash flow.
A Great Deal Can Still Become a Bad Investment
Instead of selling the renovated property, John chose to keep it as a rental.
Initially, the projected rent appeared sufficient to cover the mortgage.
Then reality happened.
Insurance premiums increased.
The loan terms changed.
The interest rate adjusted from 4% to 8%.
Operating costs became higher than expected.
Eventually, the property began producing negative cash flow, requiring money out of pocket every month just to keep it.
The purchase price hadn't changed.
The equity hadn't disappeared.
But the number that mattered most—net cash to the owner—had turned negative.
Negative Cash Flow Costs More Than Money
Every investment should support your business.
When a property consistently requires additional money each month, it doesn't simply reduce profits—it limits your ability to invest elsewhere.
John explains that many investors become emotionally attached to properties simply because they own them. Instead of evaluating whether the investment is still serving their goals, they continue subsidizing losses month after month.
Sometimes the better decision isn't to keep holding.
It's to sell.
When Selling Makes More Sense Than Holding
One lesson John emphasizes is that investors shouldn't be afraid to let go of properties that no longer perform.
If selling a property allows you to capture significant equity and reinvest that capital into stronger opportunities, it may create far greater long-term returns than continuing to hold an underperforming asset.
The goal isn't simply to own real estate.
The goal is to own profitable real estate.
Common Mistake
Many investors ask:
"How much equity do I have?"
A better question is:
"How much cash does this property actually generate after every expense?"
Those are two very different conversations.
Use One Number to Evaluate Every Deal
Before making an offer, run every property through the same filter.
Ask yourself:
- Will this property produce positive cash flow after all expenses?
- Can it absorb unexpected repairs?
- What happens if insurance increases?
- What if interest rates change?
- Will this property still make money during vacancies?
If the numbers still work after answering those questions honestly, you're looking at a much stronger investment.
If they don't, the deal may not be as attractive as it first appeared.
The Bottom Line
It's easy to get caught up in purchase price, after-repair value, or appreciation projections.
Those numbers can make a deal look exciting.
But excitement doesn't pay the bills.
According to Johnoson Crutchfield, the number that truly determines whether an investment strengthens your business is net cash to you—the money left after every expense has been paid. When that number is consistently positive, your portfolio becomes more resilient, your opportunities expand, and your investments begin working for you instead of the other way around.
Before buying your next property, don't ask, "Is this a good price?"
Ask, "Will this property consistently put money in my pocket?"
That one question could save you from making your most expensive investing mistake.
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About Johnoson Crutchfield
Johnoson Crutchfield is a real estate investor, coach, and host of the Grab the Map podcast. He helps aspiring and active investors move beyond analysis paralysis and take the consistent actions required to close real estate deals.
Drawing from years of hands-on experience, Johnoson teaches practical, real-world strategies focused on finding opportunities, building relationships, securing funding, and making offers. His approach emphasizes weekly execution over endless education, helping investors create momentum through simple, repeatable actions.
As the leader of the Wealth and Real Estate community, Johnoson shares lessons from real transactions and real conversations with lenders, sellers, and investors. He is a strong advocate for local banking relationships, seller financing, and private lending as powerful tools for growing a real estate business.
Through coaching, content, and community, Johnoson has helped investors gain clarity, build confidence, and take meaningful steps toward closing their first—or next—deal.
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