The Best Types of Rental Properties for Beginners to Buy in 2026 (Rookie Reply)

Summary of The Best Types of Rental Properties for Beginners to Buy in 2026 (Rookie Reply)

by BiggerPockets

19m•March 27, 2026
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Overview of The Best Types of Rental Properties for Beginners to Buy in 2026 (Real Estate Rookie)

This episode of the Real Estate Rookie Podcast (BiggerPockets) hosts Ashley Kerr and Tony J. Robinson and answers listener questions from beginners about where to start in real estate investing, how to choose remote markets, and how to pick between condos, townhomes, single-family, and multifamily for a first investment. The conversation focuses on practical first steps, market-selection frameworks, financing order-of-operations, common rookie mistakes (analysis paralysis), and pros/cons of major residential asset classes — plus tools and resources to speed the learning curve.

Key takeaways — What beginners should do first

  • Three foundational buckets to start with:
    1. General education — learn terminology and strategies via podcasts, books, YouTube, events, and communities.
    2. Mental/self-assessment — clarify your goals, motivations, skills, available time, and risk tolerance.
    3. Financial readiness — know your cash available (down payment, rehab, reserves) and what mortgage/loan approval you can realistically get.
  • Get financing lined up (pre-approval or lender plan) before signing contracts — it makes closing far easier and prevents losing deals.
  • Avoid analysis paralysis: once information starts repeating and feels familiar, take action. Don’t wait for comfort — confidence can exist alongside discomfort.
  • Start with criteria (your buy box) first, then find markets that match it — not the other way around.

How to choose an out-of-state / remote market

  • Use data tools (e.g., BiggerPockets Pro Market Finder) to screen markets that match your strategy and financial limits.
  • Create two market lists:
    • Where other investors doing your strategy are buying (top-of-funnel research).
    • Markets where you have an advantage (you’ve lived there, have local contacts, family/boots-on-ground, a trusted agent).
  • Filter markets by your buy box:
    • Entry price vs. your pre-approval
    • Typical rents vs. target rent you need for cash flow
    • Local income demographics (can tenants afford your rents?)
    • Crime/safety and neighborhood fundamentals
    • Inventory and market liquidity
  • Mental approach: there are thousands of viable cities — focus on finding multiple markets that meet your criteria and become expert in one or a few, rather than searching for a mythical “perfect” city.

Choosing between condo, townhome, single-family, or multifamily

  • No single asset class is universally “best” — success depends on your goals, local inventory, and numbers.
  • Questions to answer: What’s your strategy (long-term rent, flip, house hack)? What inventory is available at your price point? What are exit options?
  • Pros and cons (practical highlights):
    • Condos
      • Pros: often lower entry price, lower maintenance burden (shared responsibility).
      • Cons: HOA control can restrict rentals, increase dues, or impose special assessments; tighter rules can kill strategy (short-term rental bans, etc.).
    • Townhomes
      • Similar pros/cons to condos when HOA-controlled; insurance and structural nuances can change costs.
    • Single-family homes
      • Pros: large buyer pool on resale (owner-occupants), good exit flexibility; familiar to many landlords.
      • Cons: single point of vacancy risk (full income lost during vacancy).
    • Small multifamily (duplex/4-plex)
      • Pros: better income diversification (one unit vacant ≠ total loss), potential for house hacking.
      • Cons: smaller resale buyer pool (often investors); management can be more complex.
  • Insurance and local regulations can materially change the effective economics; always check insurance costs, HOA rules, and local ordinances in due diligence.
  • Consider worst-case scenarios and mitigation options before buying.

Actionable checklist for a beginner (order of steps)

  1. Educate yourself: podcasts, books, BiggerPockets forums.
  2. Self-assess: write down goals, timeline, available time/skills, desired returns.
  3. Get financially ready: check credit, speak with lenders, obtain pre-approval or a financing plan.
  4. Define your buy box: property type, price range, target rent, desired markets, acceptable vacancy and rehab risk.
  5. Use market/data tools and your personal advantage list to shortlist markets.
  6. Run numbers on specific comps and estimate cash flow and reserves.
  7. Line up financing or capital partners before putting offers under contract.
  8. Take action — submit offers; treat early deals as experience-building.

Tools, resources, and mentions from the episode

  • BiggerPockets Pro Market Finder — data to screen and compare markets (hosts mention a BP Pro discount code).
  • BiggerPockets forums — community answers and question submission (hosts invite listener questions).
  • RentReady — property management / landlord tools (listed in ads).
  • Fundrise — passive real estate investment vehicle (ad mention).
  • NREG — specialized insurance reviews for investors (ad mention).
  • Indeed, Shopify, Collective — sponsor/partner services mentioned (hiring, ecommerce, business financials/tax support).

Notable insights & quotes

  • Mindset: “Confidence and comfort are different — you can be confident yet uncomfortable. Waiting for comfort will often keep you from moving forward.”
  • Practical order: “Finance before property when possible — it’s much easier to get a deal closed with financing lined up.”

Common rookie mistakes to avoid

  • Treating market selection as needing a perfect match — instead, target markets that meet your prioritized criteria and act.
  • Chasing deals without confirming financing or clear exit strategies.
  • Underestimating HOA risk, insurance costs, and local regulations especially for condos and short-term rentals.
  • Letting analysis paralysis prevent taking the first actionable steps.

Final resources and next steps recommended by hosts

  • Join BiggerPockets forums to ask questions and learn from other investors.
  • Consider larger tools like BP Pro for market data if you’re serious about remote investing.
  • Do an honest self-assessment, line up financing, then go analyze deals and make offers — learning by doing accelerates progress.

If you want quick next steps: pick one education resource (podcast episode or book), write down your investment goals and buy box, get a lender conversation scheduled, and list 3 markets you can reasonably research this month.