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Updated about 8 years ago on . Most recent reply
Turnkey
Hey, I'm a young adult who has been studying up on turnkey properties and the pro's and cons of owning one, studying the various markets that offer said properties and so on. Overall I'm focused on acquiring one but I would like any advice for those who have already owned a turnkey property if its a overall good ROI investment or not. Any and all advice is appreciated.
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@Samuel M.it all depends. If you're investing for cash flow and don't expect built in cash flow and are what I call an arm chair investor, turn key can be a great way to go. If you don't have the time or skills to put a team together and manage a renovation then turn key makes sense. People assume that you pay over market value for a turn key but that isn't necessarily the case. Turn key companies have much lower acquisition and construction costs and that differential is where they make their profits. Some do put big mark ups on their properties though so make sure you're working with a turn key company that doesn't do that. If they only take cash offers or don't allow an appraisal contingency, it's a good sign they're selling above market value.
I did a podcast on how to work with turn key companies which you can find on my website.
Just make sure you're not paying over market value.