Turnkey Company Stories For New Investor

[Arron Paulino]

Hello,

I am new to real estate investing and came upon turnkey companies. They seem great for individuals with not much time to actually do the work (find tenants, property management, investigate an area, etc.). I am wondering if anyone has had success with these types of investments and are in a similar position to me (aspiring professional with W-2 income). One in particular I am looking into is MartelTurnkey and his company seems genuine, but am open to hearing about any other turnkey company stories. I do understand it is low risk = low return, but it makes it easier to just get started for me. Should I go this route to start? I feel like I am at a point in my life where I still want to succeed in my career and have real estate on the side for now. I'd like to hear from members who have had a track record with turnkeys. 

[James Wise]

Originally posted by @Arron Paulino:

Hello,

I am new to real estate investing and came upon turnkey companies. They seem great for individuals with not much time to actually do the work (find tenants, property management, investigate an area, etc.). I am wondering if anyone has had success with these types of investments and are in a similar position to me (aspiring professional with W-2 income). One in particular I am looking into is MartelTurnkey and his company seems genuine, but am open to hearing about any other turnkey company stories. I do understand it is low risk = low return, but it makes it easier to just get started for me. Should I go this route to start? I feel like I am at a point in my life where I still want to succeed in my career and have real estate on the side for now. I'd like to hear from members who have had a track record with turnkeys. 

Tons of other turnkey markets and providers out there. Many of these markets are very well represented by sellers & turnkey operators here on BiggerPockets. In no particular order I have listed some of the most popular markets for out of state investors

• Cleveland, Ohio
• Cincinnati, Ohio
• Dayton, Ohio
• Toledo, Ohio
• Youngstown, Ohio
• Cincinnati, Ohio
• Memphis, Tennessee
• Saint Louis, Missouri
• Indianapolis, Indiana
• Detroit, Michigan
• Erie, Pennsylvania
• Louisville, Kentucky
• Milwaukee, Wisconsin
• Jackson, Mississippi

Each of these markets is popular with turnkey investors because of the low barrier to entry, high rental demand & high rent to price ratio. I recommend setting up keyword alerts for each area as they are discussed in the forums daily with advertisements posted in the BiggerPockets marketplace hourly.

One thing to note when looking at the individual markets, you can make or lose money in any market. Don't think that one particular out of state market will shoot you to success or abject failure. It's not really that complicated to buy out of state. It only becomes complicated when investors try to over complicate or over think everything. Whenever you are buying a property out of state you should do a few things to ensure it's as smooth as possible.

• Don't buy in the roughest neighborhood in the urban core. Pick a solid B-Class suburban area. Perhaps a nice 1950's built bungalow.
• Always hire a 3rd party property inspector to give you an unbiased feel for the home. The reports are 40-90 pages long and go through the entire house in great detail.
• Get an appraisal. If your using financing the bank requires this. This is good. The bank isn't going to let you blow their money. They have more skin in the game then you do.
• Make sure you get clear title. If using a lender this is a non issue. They will make you do this. It's those maniacs that buy homes cash via quit claim deed off of craigslist that really get screwed.
• Make sure your property manager is a licensed real estate brokerage.
• Google Clayton Morris and/or Morris Invest for a cautionary tale of what not to do when buying turnkey real estate
• Understand you can not eliminate all risk, only mitigate it. If you are risk averse, real estate, (especially out of state) is not for you.