Due Diligence with Turnkey

[Josh Anisfeld]

I am a hopeful first time investor looking to make my first investment this year.  I have been doing a ton of research and listening to podcasts, but I am still a bit at a loss in terms of due diligence.  I am potentially looking to go the turnkey route, but don't really even know what type of questions to ask or data to look at to determine the right areas, if a house is worthwhile, etc.  

Any advice on the right questions I should be asking or what data to be analyzing?  

[Jay Hinrichs]

@Account Closed 

1. Many turn key operators own many units to hundreds I know first hand as I have funded them for the last 20 years.  But the basic answer to your question is they want to make a profit on the sale to create cash so they can buy and hold.  Just like anyone in America.. they may create cash so they can buy and hold by working in another job.. Or you see it all over BP..  " hey I am a new wholesaler I want to wholesale to make cash so I can buy and hold"  no different for the turn key companies.

Me personally I am in the finanice business and don't really care for cash flow properties of any type.  and simply because I am old and tired and don't need cash flow homes.. I had 350 of them at one time.. lots of work owning rentals...

2. this happens with any rental regardless if you buy it from a fix and flipper who specialize's in selling rentals ( turnkey company) or a fix and flipper who just puts them on MLS.. bottom line someone buys a home fix's it up and resells it no mystery there.

3. PM  is a tough business and many turn key companies engage in it for on going customer satisfaction as a big part of their after care.. and I agree with you unless you can scale PM I would not do it personally for 100 a month.. but they do make more than that they get a lease fee and mark up on repairs  Just like all PM companies get.