Hello my friends and welcome to another episode of Ask Marco where I answer your investing related questions.

This is going to be the main episode of the passive real estate investing podcast and the reason for that is is because the question here is an Ask Marco question submitted by someone by the name of Conrado. I hope I pronounced that correctly, but because it's such an in-depth question, I wanted to expand on it.

Conrado writes in and he says, hi, Marco. Loved the podcast. Very informative with the right level of information, especially for investors starting like me, my situation is the following. I'm looking to buy my first investment property soon, looking to deploy $200,000 of my portfolio to start investing in real estate. My goal is to reach 10 units in 10 years, buying one per year. That's a great goal.

My question is, should I buy cash to get the better price upfront and refinance this first property when you're from now to raise cash for the second one or should I finance this first one with 20% down and save the cash to finance the second one year from now? I feel like if I buy cash I could get a better deal in this case. How easy is it to refinance to raise cash one year from now to buy the second one? Thanks and great job with the podcast.

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Okay, so thanks for the questions Conrado this is a very good question and I think a lot of people think about this because when you talk about buying a property all-cash, a lot of people are under the belief falsely or otherwise that you can get a better price or a better deal if you come to the seller with an all-cash offer. And so let's define that for those people who don't understand what all cash means.

An all-cash deal or an all-cash offer is one where you are purchasing without financing, meaning the seller is getting all cash from you, not from a lending institution.

So look at this way. Regardless of whether you're financing a property or not, the seller is always going to end up getting quote-unquote all cash because the funds are coming from one or more places, but at the end of the day, their proceeds from that sale is going to be all cash. They don't really care where the financing or funds come from, although they might care if it's being financed because that typically takes a little bit longer from your perspective. You're either coming to the table, the closing table with a down payment, a percentage of the purchase price or 100% of the purchase price. And if you're purchasing with 100% of the purchase price, that's typically what they refer to as all cash. Now, why would you want to purchase all cash? The idea is is that if you come to the closing table or approach a seller saying, Hey, I'm going to purchase your property all cash and you think you're going to get a better price, that may be true, but a better price typically comes from two main situations or conditions.

One is when you are in a buyer's market, which we are not in today, we are in predominantly a seller's market right across the country in virtually all markets and that means the sellers have the upper hand. They know that demand is strong and buying activity is strong. Credit is widely available and it's relatively cheap, so there's more demand for the property than there are sellers to fulfill the demand that's created by the buyers in the market right now. The other situation is when you are dealing with a motivated seller,