. $40K is enough to get started AS LONG AS you have good reserves and a strong financial foundation already. 

Then I go through 6 major systems/features (electrical, HVAC, plumbing, roof, windows and foundation) for defects or issues.

Well... sadly, that's what many "gurus" do - they tell you all the positives without all the realities.That doesn't mean that you should run away, nor that whatever excited you about this to begin with isn't still valid/real... it might just mean that you need to lay some foundation first.Hard work will get you there... but at this very first stage it may be that your initial work should be focused on getting some money in hand. 

The escrow company does the bulk of the work after that.If you are using a bank for financing they will require the things that protect their interest.If you are using cash don't forget to order homeowner's insurance.If you are new to investing you want to have an inspection done that should cover at least the roof, HVAC, electrical, plumbing, drainage & foundation because those are expensive to fix and you need to know what expenses you are facing in the future.

That is in my opinion one of the best positions to learn the foundations of real estate.

Secondly, this is great foundational knowledge for "newbies".

I am not in a place to buy up a block and put townhouses on it - but I am considering maybe building or bringing in a manufactured home and placing on a permanent foundation and use as rentals - or building onto a unit and making a duplex?

I go after the low hanging fruit, and so far I haven't tackled any foundation issues either.  

Many, many homes in the area have foundation problems from 4-7".

Plus fixed the foundation.