Real Estate Rookie – Episode Summary

Podcast: Real Estate Rookie

Episode: The 4 Best Types of Rental Properties for NEW Investors to Buy
Hosts: Ashley Kehr & Tony J Robinson (BiggerPockets)
Date: December 26, 2025

Episode Overview

This episode is a comprehensive guide for new real estate investors wondering where to start. Hosts Ashley Kehr and Tony J Robinson present a simple, four-step framework to help rookies choose the best rental property investment strategy, tailored to their personal circumstances, motivations, and local market. They break down the pros and cons of the four most common property types for beginners: house hacking, BRRRRs, short-term rentals, and long-term rentals. The hosts close by addressing the biggest mistakes new investors make and offer practical solutions to avoid them.

Key Discussion Points & Insights

1. The Four-Step Framework for Choosing Your Investment Strategy

Step 1: Define Your Goals and Motivations

• Understand why you want to invest: Immediate cash flow? Long-term wealth? Replacing your day job? A side hustle? Tax benefits? Personal use of the property?
• Not every strategy satisfies every motivation equally. Prioritize what's most important to you.
• Quote:

  "Before you can really identify what strategy makes the most sense for you, you have to ask yourself, why am I doing this?"
  —Tony (01:01)

Step 2: Assess Your Available Time and Desired Lifestyle

• Consider family, work, hobbies, and how much time you truly can dedicate.
• Decide if you prefer an active business or passive investment.
• Anecdote:
  Ashley recalls almost buying and syndicating a million-dollar campground before realizing the operational demands didn’t fit her desired lifestyle (06:01).
• Quote:

  "If you really want to be sipping mai tais on the beach in Cancun, maybe you need to be a private money lender..."
  —Tony (05:25)

Step 3: Assess Your Financial Situation

• Calculate available cash, credit score, debt-to-income ratio, and your comfort with debt.
• Use budgeting apps (e.g., Monarch Money) to track finances.
• Keep reserves separate from life savings; reserves are for emergencies and property needs.
• Quote:

  "If you're having trouble saving right now or living within your means, that's a great way to start to actually build the capital to invest in real estate."
  —Ashley (11:39)

• Are you comfortable partnering with others, using creative financing (401k, HELOC, etc.)?

Step 4: Understand Your Local Market

• Consider if your budget aligns with local property prices and which strategies work in your area—e.g., short-term rentals for tourist spots, long-term in good school districts.
• Research demand, landlord/tenant laws, vacancy rates, and average rents.
• Decide if you’re comfortable investing long-distance if local options aren’t feasible.
• Quote:

  "Some strategies work better in different places. So you need to have your strategy defined before you actually go and start looking for markets."
  —Ashley (16:14)

The Four Best Types of Rental Properties for Rookies

1. House Hacking

• Live in one part of the property and rent the rest (bedrooms, a duplex/triplex, or ADU).
• Low barrier to entry with low down payments possible (e.g., FHA 3.5%, NACA zero down).
• Ideal for those with limited capital.

2. BRRRR (Buy, Rehab, Rent, Refinance, Repeat)

• Buy undervalued properties, renovate, rent, refinance to recoup investment, and repeat.
• Good for scaling quickly with access to some capital.
• Requires project management skills and knowledge of local market comparables.
• Quote:

  "One of the cons... you're going to be doing a rehab. And a rehab project... comes with project management of your contractor, having some idea of what goes into a rehab or what needs to be rehabbed."
  —Ashley (22:45)

• Tony credits his early success to assembling a good team: lender, contractor, and property manager (24:21).

3. Short-Term Rentals (e.g., Airbnb)

• Higher cash flow potential and unique tax benefits (e.g., short-term rental tax loophole).
• Requires more active management; not passive.
• Increasing competition means quality and creativity are more important.
• Management fees range from 10%–40% depending on service level.
• Quote:

  "It's really only the ones that are like the cream of the crop, you know, where people are really running this like a business that are doing, doing incredibly well."
  —Tony (25:19)

4. Long-Term Rentals

• More passive than short-term, but still requires oversight (asset management, renewals, repairs).
• Predictable, steady cash flow.
• Most accessible for those with time constraints; easier barrier to entry.
• Possible exit strategies: sell as investment property or to a primary homeowner.
• Truly passive options: private lending, syndications, fractional ownership (e.g., RealBricks).
• Quote:

  "This is definitely more passive, I would say, than short-term rentals, but it's definitely not a passive investment."
  —Ashley (28:33)

Biggest Mistakes New Investors Make (and How to Avoid Them)

1. Analysis Paralysis

• Over-researching, never taking action.
• Solution: If you repeatedly recognize everything in podcasts/books, start taking concrete steps (submit offers, analyze deals, etc.).
• Quote:

  "There's also a point where all of that quote unquote education... just really turns into like, I don't know, I guess analysis paralysis."
  —Tony (36:39)

2. Shiny Object Syndrome

• Jumping from strategy to strategy without focus, never building real progress or expertise.
• Solution: Choose a single approach, build expertise and foundational experience before pivoting.
• Anecdote:
  Ashley describes her disastrous budget overrun on her first A-frame short-term rental rehab and why building upon long-term rentals first gave her resilience (40:29).

3. Taking Advice from the Wrong People

• Listening to friends/family without real estate experience leads to missed opportunities.
• Solution: Only take strategic guidance from people who have achieved what you want.
• Quote:

  "Even if your parents, even if your best friends... you've got to take advice from people who have actually done it."
  —Tony (42:19)

Notable Quotes & Memorable Moments

• On aligning your investment with your lifestyle:

  "Understand the lifestyle and the time that you have available to, to kind of help point you in the right direction."
  —Tony (05:25)

• On reserves:

  "Reserves aren't your kids' college fund... This is the money... specifically saved in reserves for your rental properties."
  —Ashley (11:39)

• On making the leap:

  "You just need to know enough that you can confidently take that next step."
  —Tony (36:39)

• On foundational strategy:

  "If you fail or it doesn't go the way you think, like you still have that strong foundation of your original strategy."
  —Ashley (40:29)

Timestamps for Key Segments

| Time | Segment | |----------|-------------------------------------------------------------| | 00:00 | Introduction: Feeling overwhelmed as a rookie? | | 01:01 | Step 1: Define your goals/motivations | | 03:57 | Step 2: Assess your time, lifestyle, and involvement | | 10:35 | Step 3: Assess your financial situation | | 16:14 | Step 4: Understand your local market | | 19:25 | Four best property types for rookies: overview & details | | 24:21 | Building your team for BRRRR success | | 25:19 | In-depth: short-term rentals pros/cons | | 28:33 | Long-term rentals, passive investing, and hybrid paths | | 36:39 | Biggest mistakes: analysis paralysis, shiny object syndrome | | 42:19 | Taking advice from the wrong people |

Final Takeaways

• Clarity trumps urgency: Take the time to understand your why, your resources, your local market, and your tolerance for activity/involvement.
• Focus wins: Pick a single strategy, build expertise, and establish your foundation before pivoting.
• Action is essential: Don’t get stuck in analysis; take steps, learn, and adapt.
• Filter advice: Respect well-meaning skeptics, but only act on advice from those with real success in your desired niche.

For more rookie investment insights, resources, and downloadable tools, visit BiggerPockets.com and check out their extensive rookie forums, agent finder, and lender matcher tools.