Turnkey Exit Options

[David Katz]

Will soon be purchasing my first turnkey property.  But before committing, wanted to learn a little bit more about exit options if I decide to sell at some point.  Of course, the goal is to buy and hold long term.  And I figure that this question largely depends on which TK provider you work with.  But just curious if folks have general advice on TK exit options, whether it creates any additional hurdles to selling, examples of trying to sell TK properties in the past, etc.  

[Lance Robinson]

@David Katz

Hey David! More important in that is where and how you are buying. I like to buy properties in markets that are on a population and job growth and buy in an area that is around the median of the metro home value. This ensures you have solid renters that are usually young families just about ready for a starter home and will stay a while and take good care of your place. Usually means good school district, low crime. And has a nice blend of new homeowners and buyers as well.

The blend means you have a pool of investors and homeowners that have pride of ownership which is a nice balance between cash flow and appreciation.

If you go too low, you will be in an investor only area and will have no appreciation and a TOUGH exit as everyone wants a deal!

If you go too high, you are in homeowner's only and it's tough to get a buy, it will be an easier sell with more appreciation, but a harder rental market as you will have good tenants that would likely leave after a year to go buy something, meaning high turnover and tough rentability.

The middle is a sweet spot between the both. When you aren't buying with a deal, it's extra important to buy in the right spot! "location, location, location" Hope the "why" helped, let me know if you have any other questions!