Recommended Locations/Regions for Turnkey Investing

[Joshua Zapin]

I have more money than I have time and live in a market (Boulder, CO) that doesn't lend itself well now for investing.

Turnkey real estate investing seems like the right entrance into REI for me.

Question: What are some recommended locations? Some of the ones that I have intrigued me based on the reputations of turnkey investment companies that focus on them include:

• Memphis (Memphis Invest)
• Houston (Memphis Invest)
• Indianapolis (Morris Invest)
• St. Louis (St. Louis Property Direct)

Any other thoughts/recommendations?

Any thoughts would be greatly appreciated.

Thanks.

JZ

[Aron D.]

I used a turnkey provider and was offered a 9% return on my note purchase.  I am in CA and the property was in PA.  I got steady payments for 18 months and then it started to go downhill.  I had to constantly follow up about interest payments and eventually found out the turnkey provider was going under.  The property was given back to me via deed in lieu of foreclosure.  I obtained a property that was in bad shape.  It had back taxes, utilities, interior beat up, and the roof was shot.  During this time of transition, PA was in a winter storm and the pipes burst in the house.  The property manager and contractor repaired the damage.  After 4-6 months the property finally was in a condition to put on the market to try and get my money back, but it took all the interest payments plus extra funds to get it to this point.  We priced the property equivalent to the amount a down payment would require on a house in CA.  I didn't realize the challenges in investing in such depressed areas.  As Charles Roberts stated, it is not worth it for me to trust a 3rd party that I am not familiar with.  I was referred to this company by my 401k provider and assumed they did their due diligence. 

Everything could go smoothly for 1 to 2 years and then once things go downhill, then it can get bad quickly.  I have the best luck and income from investing in properties that I can drive by everyday and vet the tenants myself.  If you feel like flying out and visiting the property yourself and seeing the condition it is in before you buy and during the rental period, then go for it.  I just can't justify the hassle for $200-$300 profit per month.  The back taxes I had to pay to make the property current was $4k, new roof $7k, rehab interior $10k.  It was the largest headache for the least amount I've ever invested in real estate.  Hopefully I can recoup some of the money invested and not take too much of a loss.  Also hope the property management company is honest about repairs and the mechanicals of the home can stay together by the time I get an offer.  It is currently rented and the renter stated bed bugs were in the house.  It has been vacant for 6-8 months.  I got a quote from them that the exterminator wanted $1400 to rid the house and I had them get additional quotes.  It cost $750 to get rid of the problem.  Good luck on whatever you decide to do.