Has anyone used Crestcore or similar Turnkey-Lite/BRRR services?

Question

Hi guys, I closed with Memphis invest just a few weeks ago and am now looking at my options for OOS property #2 & #3. While I was doing my research I came across Crestcore. They offers a alternative to the turnkey model In that they are a traditional Realtor who has their own construction and Property Management crew. They would look for distressed and off market properties based on the investors criteria, provide a scope of work, renovate the property to the investors liking, and then PM it if you so choose. They call this their Turnkey Alternative program. I have encountered several companies that has a similar model and am wondering if any investor has ever used Crestcore or a company like Crestcore to successfully BRRR OOS? Or to at least used them as an alternative to the traditional Turnkey Method? I beleive thegoal of the Crestcore program is more to get a discounted property vs a traditional turnkey rather than a "true" BRRR where you get all your money out + possibly a profit.

I have listened to Crestcore's Radio show/podcast and @Dean Harris and @Dan butler seems to be very knowledgeable, reputable and ethical. I have heard over the forums that Crestcore's PM arm is very effective at managing lower income areas similar to Terry Kerr or Derrick Criag's companies. What I haven't seen is any case study or any investor giving a detailed account on the internet about going thru their Turnkey-Alt program. Has anyone tried it? Care to share any insights?

Now before anyone gets started, yes I understand the risk of this model. I would incur all the front end risk.

I have listened to Crestcore's Radio show/podcast and @Dean Harris and @Dan butler seems to be very knowledgeable, reputable and ethical. I have heard over the forums that Crestcore's PM arm is very effective at managing lower income areas similar to Terry Kerr or Derrick Criag's companies. What I haven't seen is any case study or any investor giving a detailed account on the internet about going thru their Turnkey-Alt program. Has anyone tried it? Care to share any insights?

Now before anyone gets started, yes I understand the risk of this model. I would incur all the front end risk.

David Hutson · Answer

@Wei Jie Yang,

1.  Actually, I can talk about Crestcore's RE team works.  My partner and I have both purchased homes working with Dean.  It's an easy process, just pick a house and do the contract.

2.  I did have the house appraised when it was done.  I made about 10% equity in the deal after purchase and reno compared to the appraised price.  The rehab was decent but I didn't spend enough to get as good as many of the turnkey I have purchased.  With you doing the rehab you must determine how nice you want the property to be.

3.  I would say their model is BRRRR since it's not turnkey, at least to me, if you buy the home and then rehab it.  They help you get and rehab the home and then it's up to you.  They wouldn't be involved in the refinance.  I have just used cash I have so I didn't refinance any of the homes I have done this with.

I'm pretty sure of my answer and even though I'm pretty good friends with them I don't want to speak for them.  @Douglas Skipworth is one of the owners and is on  here consistently.  He may want to chime in.  I don't really see @Dean Harris chatting on here much but maybe he is and can chime in.

They can definitely help you find the homes and get the rehab done.  You need to understand and determine the quality of the rehab you want done and ensure whoever is doing it understands.  Try to match the other local homes.  I try to get my homes a little nicer than they neighborhood so I can rent faster and maybe get higher rents.

As you continue your search stay in touch through messages.  I'm moving out there in a few months and go take a look at homes or neighborhoods if you need assistance.

David Hutson · Answer

@Wei Jie Yang,

I have used them for that and they still manage the property.  I found a house I liked and they rehabbed it for me and put a tenant into it.  I earned a little equity in the deal also since there were no issues found during the rehab.

You mentioned you already know you could have unknown issues that come up during the rehab.  Also consider the rent up and vacancy up front.  You will want to do a good enough job that it will rent to good tenants in the area you choose or it could sit vacant for awhile.

Jeff Mills · Answer

I have been working with them as of late and I haven't heard of a "program" for doing BRRRR deals. It seems like you may be expecting them to BRRRR a property for you. In my experience, they will help you find properties just like other Realtors, based on your criteria and they will provide a rehab estimate from their Construction wing if you wish. In my case, on a property that I found, we got it under contract and they first gave me an estimate to just get the property rent ready because I hadn't clarified my intentions to BRRRR it, so they were helpful enough to go out and give a more thorough estimate based on a value-add rehab. I'm currently renegotiating based on findings in the inspection so I may not end up closing.

So really, in my experience, the only difference between doing it yourself with an agent and going through Crestcore is they have their own construction company that they can coordinate with so it can save you a lot of effort there. You don't have to use them though. You still have to decide the scope of work you'd like to do and if your goal is to BRRRR then it's up to you to run those numbers and do the right amount of rehab. And obviously, the refinance is on you as well. And then they obviously have there PM side of the company which I've been pleased with so far.

So, in summary, there are some nice advantages/conveniences of doing all that through Crestcore but it's still up to you to manage things in order to do a successful BRRRR.

Mark Ainley · Answer

@Wei Jie Yang we have a long-standing working relationship with Douglas Skipworth and Crestcore in the property management world. They are a stand up organization and always finding ways to tweak there process so it is always getting better.

Wei Jie Yang · Answer

@David Hutson it seems like you have experience with every Memphis provider out there!

In regards to Crestcore's services:

1) You found the house, so I guess you didn't can't comment on how @Dean Harris and teams service as agents are?

2) I'm assuming since you said you earned a little equity you meant you refinanced? Or do you mean just mean the appraised value now is higher than purchase+reno?

3) I have heard them call their service a BRRR strategy on their radio show. But I beleive the goal is more of a Turnkey discount model. I know you're not the one to ask but can you comment what the actual goal of the program is? Is their goal for the investor, to find a distressed property and to have the ARV be enough for the refinance to cover all expenses (like what a "ideal" BRRR is in my mind) or is it to have the ARV after the cash out refinance be better than a typical house an investor would buy from a turnkey player.

Thanks again @David Hutson You do not know how much of a help in deciding alot of things your posts have been to me.

Koleton Daley · Answer

@Wei Jie Yang Please do yourself a big favor and stay far away from Crestcore..  I could write a book about our experience with them and how horrible it was for us. I think it’s better to let our attorney explain as he has the entire list of things along with photos and videos of fraudulent work being billed and not actually completed and additional damage they caused to our homes.

Jeff Mills · Answer

@Wei Jie Yang I don't think I've been working with them long enough to answer those questions. I will have a better idea in a few months as I'll be closing on a planned BRRRR property this week. I can say that I received an ARV opinion from them and got a second opinion from a 3rd party and they were within a couple thousand dollars of each other.

Monica Abeyta · Answer

@Wei Jie Yang Did you ever happen to go through with the CrestCore Turnkey Alternative program? I am researching it myself right now and am looking for investor feedback on the program. Thanks for any insight you might have.

Wei Jie Yang · Answer

@David Hutson I will definitely keep in contact ! You and your posts have helped me out substantially!

@Jeff Mills @Dan Butler and @Dean Harris call it a BRRR program on their radio show/podcast. That's the only reason I am referring it that way. I'm more interested in finding out

1)How effective they are in finding these distressed properties that fits the investors criteria?

2) How accurate is their scope of work and estimated costs? Has any client dealt with overages of a substantial amount?

3) What is the quality of their rehab work? How timely are they?

4) Is their ARV calculations accurate (I'm assuming they give one) provided a client does all the recommended rehab?

Yeah, I realize the refinance part is up to me, but that's the case with all providers that offer similar programs. I would think a reputable PM company that has a construction crew to work with to get a BRRR done than separate Agent/PM/Contractor.

Has anyone used Crestcore or similar Turnkey-Lite/BRRR services?

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