Education

• This may sound obvious, but the first key to real estate investing is to understand what you're doing. Pick up a few real estate primers at the library. "Multiple Streams of Income" by Robert Allen, "Investing in Real Estate," by Andrew McLean and Gary Eldred and "Buy, Rent, Sell" by Robert Irwin are often on top 10 lists of all-time best real estate investment books. If you are going to do property management yourself, also get a copy of "Landlording" by Leigh Robinson and consider pursuing one of the property management designations such as the CPM (certified property manager).
  
  

Concepts

• Don't even consider buying your first property until you fully understand the tax implications associated with real estate investment, leverage, the advantages and disadvantages of each mortgage type, your state's and city's landlord-tenant regulations, and every aspect of carry costs. Knowing the numbers will mean the difference between profit and loss. Knowing tenant laws will allow you to keep the money you earn.
  
  

Scale

• Start small. Don't break the bank on your first purchase because you think you'll flip the building in a month for a whopping profit. Turning a profit on a quick flip takes years of working in the business, and even then sometimes backfires. Invest what you can afford to lose. This might mean your first investment property is a condo instead of an apartment building. Start with the idea of holding for a term of five to 10 years. If there is a burst of appreciation, you can always decide to sell sooner, but you'll be prepared to weather unexpected periods of value loss.
  
  

Location

• You know what they say about location. It's true. It doesn't matter how low a price is. If you buy a house in the middle of nowhere at a steal, that's just the price you're likely to rent it for and sell it at. It matters where the property is located. Your new mantra should be, "buy the worst house on the best block you can afford."
  
  

Warnings

• Never start out your investment career buying a property that doesn't carry itself. Never. Anticipated rents and vacancy rates -- which you have researched thoroughly by scanning rental ads, reading planning studies and talking to area property management firms -- need to at least cover all of the property's monthly expenses. If you buy a building that costs you money every month and the market doesn't appreciate or, worse, goes down, you will be stuck with a money pit you can't afford to sell. On the other hand, you can choose to hold a building that carries itself or, better yet, shows a monthly profit forever.