109 Walnut Trace, Hendersonville 37075. Year built: 1987. Square feet: 2,192. Description: This three-bedroom, 2½-bath home is in the Hickory Grove

When you start investing in real estate, what will you buy first?

When you start investing in real estate what will you buy first?

When I started investing, I bought several condos in Washington, D.C.—one at a time. But I don’t recommend condos today. You have too little control over management and expenses. They can be a lot more difficult to get positive cash flow than other well-chosen properties. Plus, condo associations can be unpleasant to deal with.

Instead, try single-family homes or townhouses. Moderately priced in good areas that will cash-flow.

For something less expensive, but generally with quite high returns on investment, try mobile homes.

Of course, you don’t have to buy anything to invest in real estate. For instance, you might start (as a lot of people do) in wholesaling. You find a property, put it under contract, and then assign the contract to someone else for a fee.

Another way to invest without buying is through options. In residential real estate, most end up being lease-options, but you certainly can do straight options. Those options are used a lot more in commercial real estate and land development.

Another way to invest without buying real estate is to invest in notes. (I don’t do that, and I’m not that familiar with it. But the people I’ve spoken to who do it seem quite pleased with the results.)