I tend to follow stocks that are a little volatile.

Careful with the whole idea "Foreclosures are cheaper" I'd recommend reading Zillows book, which gets into that subject and clarifies that foreclosures (Dependent on state, location and market volatility) are not as much of a deal as people normally think they are.

Loans are generally viewed as less volatile than stocks.  

Denver would be great for flips because of all of the volatility.

I am interested in real estate because uncomfortable with the volatility of the stock market.

When that happens, there will be a flood of affordable condos into the market, and that will result volatility in the prices of Denver real estate that will trickle across the state.

Buying better properties in better areas gives less volatile returns, which may be less over the life of the investment compared to a lower class of property, but (and I'm saying this with an eyes-on-the-ground perspective) they're much less hassle to deal with.

Diverse economic markets are also attractive because they are insulated from volatility from a single industry.

Lots of people have $40k sitting around with the stock market so volatile. 

Personally I would prefer less volatility.