Ok to purchase turnkey (new investor)

[Shawn S.]

I’m close to purchasing my first turnkey and I wanted to see what others thought about doing this during a pandemic. With unemployment rates running so high it seems likely that I could end up with an unemployed tenant that’s unable to pay rent. I want to invest just not sure if now is the best time. I know there is probably never a perfect time for anything. Would be great to hear your thoughts

[Robert Shortsleeves]

I recently wholesaled a turn key/rent ready deal near Fort Bragg for 63k and the end buyer just informed me that it appraised for 93k!!! Needless to say, the BRRRR strategy in Fayetteville is alive and well.

Also, it appears that we've fared pretty well with the pandemic as far as collecting rents. I have a small eight door portfolio and we've been able to collect 100%. Friends with larger portfolios have had a handful of tenants that couldn't pay but it's nothing a good PM can't handle.

In my humble opinion, I'd stick to the BRRRR strategy unless you have a large amount of cash for multiple down payments. My first purchase was done with a conventional loan which means that cash is stuck in the deal for now. Decided to BRRRR my next deal and I was able to pull my cash out and buy another. At some point we need to consider the velocity of our money.