That being said, the fastest way to get burned in real estate is to be under capitalized, so even if you have the money for the down payment, I would also make sure you have another at least $10k available, although personally, I would want a little more than that for my rainy day fund.As Jesse mentions, there are syndications, which are a great way to get exposure to real estate without the day in and day out hassle of owning properties directly. 

Everyone has their first deal but you don't want it to crash and burn.

Then young women stood up during our 4 hour finals to burn their bras against the Vietnam war. 

If you burn yourself out too quickly you won't have enough to get you through the long journey, but if you don't keep the flame stoked enough it will go out just the same from the wind blowing on it.

In the event the house is destroyed beyond repair, i.e burned down etc, do you refund the option fee to the tenant?

I just did the same thing that you are considering.I ran my own music business for the past 12 years.I got burned out and decided a year ago it was time to move on.During that year I've spent tons of time researching, learning, posting here on BP, listening to podcasts, etc.Like you, I was able to put away some savings to live off the past year and get going with my REI aspirations.I'm 34 years old and as of today I'm focused solely on REI moving forwards!

Inspections: I am learning the importance of doing inspections...after getting burned on one deal.  

How are you going to find the idiot with a few hundred K burning a hole in his pocket?

Besides burning the place down ;) Aren't there laws against bringing down the property values in a neighborhood?

I had $210k burning a hole in my pocket and was able to get under contract on 4 duplexes in Chattanooga and close on them before the naming period was even up.