my wife and i have been doing the RE thing for a while now and have done well, but over the last 12 months i have noticed that prices are getting crazy.  To me, it is hard to justify buying property (we only focus on multi family) at this time so it makes me uneasy to see the posts from folks saying they are ready to start investing/just bought their first place, etc.  While i appreciate there is a region/local aspect to investing that may make one market a bargain while another is over valued, i would like all the new investors to read this story (see link at end of this post) and consider the following:

• if you don't know how to calculate cash on cash or cap rate, don't buy anything yet--you have homework to do AND remember cash on cash and cap rates are helpful tools but not the sole valuation tool/consideration on whether to buy a property not--read lots of books BEFORE you buy
• if you dont know how to find out what rents should be in the area you are considering, don't buy anything yet--you have homework to do
• if you dont have a lease to use and understand why each section is in the lease--dont buy anything yet--you have homework to do
• if you dont know what happens to tenant deposits after you acquire a property--dont buy anything yet--you have homework to do  AND get a different real estate agent--one that actually deals with income property and can walk you though the details of income property buying
• DO manage the first property or two that you purchase.  You will learn ALOT of invaluable lessons!!!!! outsource the management after you have managed through several tenant turnovers and understand what it takes to manage a property.  that way you will know what you want out of a property management company.  
• if you dont have at LEAST 6-months of reserves (or sufficient non-RE related income source) to cover surprises (which will happen on every property) dont buy anything yet
• use the SEARCH function on biggerpockets BEFORE you post your question--your question has probably been asked before and seasoned investors might not answer your post because they have answered it before.
• if you dont have a business plan, dont buy anything yet--you have homework to do.  A business plan doesnt need to be formal, but it does need to include WHY are you investing in RE, what is your strategy (i.e. flipper, buy and hold, etc), when do you expect that strategy to work and NOT work (e.g. what market conditions are better for flipping vs buy & hold, what has to go right for a deal to work, what could go wrong to make it an epic fail), what type of properties are you interested in and WHY, what types of markets/areas are you interested in and why (i.e. war zones may be good cash flow but you have management issues, high end areas my have low management headaches but smaller cash flow), be honest with yourself about what you can/cannot do (e.g. if you are handy, can you do repairs yourself?  Do you have the time?  if you need to be liked by other people do you really have the personality to be a landlord?
• Do NOT let doubters talk you out of RE investing.  their limitations and fears are not yours

http://www.bloomberg.com/news/articles/2016-07-14/...