What is your strategy for maximizing its potential? 

There are a number of strategies, terminology, and market factors to understand.

Hi Jordi - confirming some of the numbers above for DSCR loans, generally maximum LTV for a cash out is 75% LTV, a rate and term refinance could go up to 80%, maybe 85% depending on the seasoning and rental strategy. 

The only issue is based on my research once I pay off most of my debts and save up some money I'm not sure where to start.Since I'm not able to save up $10K plus to buy a rental I am looking at for alternative investment strategies to help build up my initial investment (ideally $30K-$40K).  

The first tax benefit of real estate is that the cash-flow and appreciation grow tax free(in general).Cash flow will likely be offset by depreciation and appreciation is not taxed.If you are making 8% on real estate(combined cash flow and appreciation), you money will double  in 9 years.If you make 12% on real estate, your money will double in 6 years.There are other strategies in real estate(time involved in real estate) where you can create 'paper-losses' to decrease your W-2 wages, interest, dividends.I normally don't like this route too much as I think people can focus their time and attention more on other tasks that can generate a higher hourly return.Best of luck.

Is this a reasonable strategy?

look at U-Haul, united van-lines where people moving and where is business friendly place invest where **** can GROW BRO...Idaho,AZ, Texas, Florida, SC and TN......U simple want best chance to win and yes read up not that hard owning in other states..... 

Then it's a win-win.

I'm starting to build a business to grow my rental properties and would like to get some advise on what's the right asset protection strategy for me as a starter.I live in CA and currently have 3 rental properties in CA, 2 are long term and 1 is short term.

@Cooper Moran, there are almost as many real estate investing strategies as there are types of people!