The trick that I use is that I don’t specifically go out there and look for rental properties. I let them fall into my lap through the marketing that I am doing. By doing extensive marketing I am getting a lot of leads coming in. I always look at each lead and determine what would be my best exit strategy for it, instead of saying my exit strategy is a rental let me find a lead that matches.

I am not advocating that you get into the rental business until you are ready. There are a couple of things that you need to know. First, you need to have the money to be able to sustain you in case you have a prolonged vacancy for any reason or you have an unexpected repair. The other thing is you need to be a professional landlord. You need to know how to be a landlord to your properties. Where investors get into trouble is they think that all you have to do is go out there and rent your properties. And that’s not true. You can have a great rental property and you can make a lot of money in this business if you learn the right thing to do. Please don’t go out there and just become a landlord if you haven’t taken some programs on how to be a professional landlord. If your geographic area does not support rentals, in other words the price that you would have to pay for the property and the mortgage you would have to take over would not support the rents that you would get. For instance, in California it is very difficult in the high priced areas to find a property where the mortgage could be paid by the rent on that property. So the only way someone in an area like that is going to be able to become a landlord is to buy property outside of the geographic area. Should you decide to do that the first thing I would recommend is that you have some experience under your belt. Don’t try to go outside of your backyard before you have done investing in your backyard. If you are going to go outside your backyard make sure that you have great people there that you can work with and trust. And I still recommend not buying properties that you haven’t seen yourself.