Starting Out In A Small Town

[TAYLOR BRANNEN]

Hi everyone! I've been told that your first property is the hardest and for me thats no exception, I want to make sure I do this right the first time. I just purchased my first home in February and I'm looking to make a purchase in the next few months. I have 20k that I am prepared to put down on a property and excellent credit. 

I live in a small town outside of Austin,TX and because of the cost of property inside Austin is very high I have been looking in some of the outlying areas. Populations in the cities I have been looking range from 1000 - 4000. I'm going into this with a buy and hold strategy and I want to generate cash flow, I would love to start in commercial (storage units and warehouses) but nothing in the areas I have looked are either for sale or in my price range. My next option is to go the residential route...

Has anyone had experience in small towns? My concern is that my unit will sit vacant for too long a period. Are there any people I should seek out in my community for information on rental properties? 

Also what are the steps you go through in determining whether or not a deal is a good one or not. I see a lot of people on the forums say they pick houses up for 40k and amounts much smaller than I'm used to seeing listed for sale in my area. Am I looking in the wrong areas? 

Your help is greatly appreciated!