There are still markets in the United States that allow either the beginner investor, or the seasoned expert to invest at low price points in B class neighborhoods.As real estate prices have generally recovered since the financial crisis, there are still pockets that remain, where if you know what you are doing you can purchase a home for between $60,000 - $100,000 in a solid B class area with infrastructure supporting a tenant and home owner demand (Just ask all of the Midwest folks)These homes range from 2 bedroom, 1 bathroom all the way up to 4 bedroom, 2 bathroom and even duplexes.Price sensitivity is important for many reasons.

What you don't want to have happen is you get the perfectly-appraised property and then the bottom falls out of the city it's in and the values go into the trash and you can't recover (different than a general real estate crash, because those tanked values will come back up...just don't sell while they are down).All the while, have that steady cash flow in place. 

Here is the time it takes the DJIA to recover after a crash: CLICK on image to enlarge.

If you're looking for additional safety, you could even split some of it to be invested into conservatively underwritten debt, so that if things go badly you can foreclose and recover some or all of your principal.

There are rural areas in Kern County where prices have not really recovered like much of the state and better cashflow exist,  But these areas don't have the solid job base that bigger cities have so finding solid tenants is a challenge.  

How do you deal with the threat of natural disasters, take the last hurricane (Michael) for an example how can you recover as an investor from a disaster like this?

Any money that comes out of your pocket you have to recover before you make a profit.

First, what will it cost you to go after the seller to recover this funds.

If the tenant fights the charges, you should consider taking them to court to recover the cost.It's hard to know where to lay the blame without seeing all their communication.

Yes, when you prevail, you may recover your fees...but the other party knows it's a long, expensive road to that point and figures sooner or later, no individual can outlast them.