I never got financials that I trust, so I have no idea what their expenses were.  

But if I can't find one in my price range (as somewhat nice Baltimore areas are expensive) I would like to buy a house to rehab it while living in it. 

But lets say I purchased a duplex for $175,000 on a 3.5%FHA loan ($6,125 down) how much money would you consider putting in a reserve going into the deal for later expenses?

If I am understanding the above correctly, does this mean that we should buy a more expensive property for our first, perhaps a triplex with three income-producing apartments, since that is our one opportunity to pay only 3.5% down?

and am interested in exploring working with investors to enhance new properties or renovations in exchange for knowledge and a cut after expenses.

Not the cheapest for sure but not the most expensive.  

I want to buy/Invest in Real estate, my problem is – If I buy sometime to live myself then it has to pass in my criteria, near to My office, near to My friends place etc, which makes any candidate home way more expensive.I am thinking of buying an investment property while living in a rented home.. again Seattle market is very hot (the way I see it ) because rent you get it lesser than your monthly expense for that house.

I've flooding my head with podcasts on BP and trying to retain as much as possible, feeling a bit overwhelmed but it's making some sense.

I'm starting to get overwhelmed with all the info and would like to know how you guys overcame this and how you started in REI?

I have $40k in savings and very low living expenses.