Cash flow is almost always crucial to the failure of many real estate investing projects. By their very nature the types of assets that you are likely to encounter in this sort of business are relatively less liquid than other assets. In this instance we take liquidity to mean the ease with which that asset can be turned into cash. Cash is needed for a variety of reasons including paying wages and buying raw materials.

If you do not have cash then the business functions can fall and you may end up being forced to sell your assets or close the business altogether.

A Proverbial Struggle
Sometimes your tenants will fail to pay rent or they might even refuse to pay as it is. You are then faced with a situation whereby you are constantly looking for the money to even pursue them in court. Where you really pile on the pressure, the tenant might agree to pay in installments. While this will generally work for them it does not take into account the fact that you need to carry your business as they trudge along in their installment plans.