Turnkey or BRRR to enter an out of state market

[Kenneth Biason]

Hello All,

I am planning on investing out of state, right now I am looking at Indianapolis and Fort Wayne, Indiana.  Would you recommend beginning with a turnkey property to get into the market, or would jumping in with a rehab be a better way to begin for a new investor?

[Jeff Schechter]

There are no blanket statements that make sense in this arena.  @Clayton Mobley's assessment of the value of time is accurate.  What most people who want to "build a team" fail to realize, is that they are not operating at scale.  They do one deal at a time.  They are still paying big markups for contractors, and possibly paying more for the property up front.  

Turnkey companies that operate at bigger volumes (10-20 deals per month) have MUCH better buying power, and MUCH more economies of scale built in when it comes to rehabs.  In order to get to this size, ALL of their operations have to be systemized.  In many cases, the end buyer is NOT paying more.  

It pays to shop around!