One of the best things about investing in real estate is how many different opportunities you have. Besides the huge market, there are a number of real estate investment strategies available to you. The hard part is deciding which one to move forward with, and then executing.

For new investors, here are the four best options to consider.

Rent Out Single Family Homes

By far the most common, purchasing single family homes and renting them out is a great source of consistent cash flow. As long as the monthly cash flow can cover the mortgage, insurance, taxes and repairs, you are building a great asset through the renter’s hard-earned money.

The important thing to remember with this strategy- along with most others- is that you make money when you buy, not when you sell. What that means is you must get a good deal on the home if you’re going to have a profitable investment. Buying a home worth $200,000 and paying full price will make it much more difficult to profit from the rent each month.

On the other hand, if you were able to buy the same house for just $130,000 because the owner needed to sell quickly, it will be much easier to have a positive cash flow each month.

Rent Out a Multi-Family Home (Duplex, Triplex, Quadplex)

This is probably one of the best real estate investment strategies for beginners. One reason is because banks treat the home the same as if you are buying a single family home, making it easy to get financing. These units are also easy to maintain, as you won’t have a very large number of tenants or land.

The advantage over single-family homes is the ability to earn multiple streams of income. This helps generate a positive cash flow every month and cover the gap when you have an empty unit after a tenant moves out.

The difficult thing about these units is finding one! Most neighborhoods don’t have them, and the few that are out there don’t go on sale very often because they are such great investments.

Mobile Homes

Some people scoff at the idea of renting out mobile homes… but the investors that go with this real estate investment strategy will have the last laugh.

Mobile homes are relatively inexpensive, considering you can easily fit an entire family in one. This means a new real estate investor can likely purchase several units for the price of just one single family home. Similar to a duplex, this lets you rent to multiple families, giving several streams of income.

The hardest part about investing in mobile homes is it finding a quality group of homes already connected to water, sewage and electricity. Instead, you may need to combine purchasing these units with a new plot of land, and have the utilities run out there.

Real Estate Investment Trusts (REITs)

The most passive form of real estate investing is REITs. An REIT is created when multiple investors pool their money into purchasing real estate. Buying into the REIT is usually as simple as transferring money to an REIT mutual fund or purchasing shares, similar to buying stocks.

There are two primary advantages to REITs over other investments. The first is that it is very passive- you don’t have to worry about collecting rent, maintaining the property, finding tenants, etc. Instead, you just collect your dividends and (hopefully) watch the value go up over time.

The other advantage is the ability to invest in areas you couldn’t enter alone. For example, you probably can’t invest in large apartment or commercial buildings by yourself, but an REIT gives you that kind of buying power.

This real estate investment strategy isn’t perfect though. Realize that you are giving up almost all of your power and opinions by investing in an REIT.

So Which is the Best?

To be blunt- it depends. If you like the idea of a passive investment, go with REITs. If you want to become a landlord and just start with one tenant, get a single family home. If you are ready to learn (and get wealthy) a bit faster, look into multi-family options.