This question of “which is best” begs for a simple straight-forward answer.  Unfortunately, when you consider the many variables (and, therefore possible answers) at work here, it soon becomes apparent that an an iterative process of several answers to several questions is in order.  So, the answer to the big question becomes merely the sum of those smaller answers organized systematically to reach a practical conclusion.  Some of these questions are, for example:

• What is your risk profile?  What rewards are appropriate (in your mind) for that risk?
• How’s your credit?  Those scores affect the range of choices available
• How handy are you and how much time can you devote to your investment?
• How much “hassle” are you willing to tolerate?

Now, before you get frustrated with the apparent presence of more questions than answers, know that we have “been there, done that”.  So, the flowchart below has been constructed to guide you through that collection of choices which impact the probability of success in your effort.  If you are a novice, use this as way to prioritize and streamline an otherwise complex process.  If, on the other hand, you have been doing this for a while, consider this exercise as a “reality check” that offers some external validation.

The summary above is distilled from Chapter 1 of our popular, 200 page book The 2009 Guide to Colorado Real Estate Investing.  For more detail, including eight more chapters  about virtually every aspect of Real Estate Investing — Property Mgmt, Team Building, Financing, Managing the Buying Process, Rental Property Fundamentals, Selling a Property, and much more, send me an email at bart@reinvestgroup.net.  Don’t miss this opportunity!