Advice on turn key investment in Texas

[Kevin D.]

Hi,

I am looking to investing out of state. My primary goal is to have a passive income stream without requiring too much headaches (I know, asking a lot). With investing out of states, I want the property to be as hands off as possible because I just cannot be there. With that said, I am thinking of purchasing new developments in relatively nicer neighborhoods. I am looking for cash flow areas and do not expect appreciation although it would be nice. If the investment turns out to be more trouble than its worth, I want to be able to sell and recoup my money back with minimal hassle (wishful thinking I know).

For those in the area, can you tell me if the numbers the turn key company provide seem reasonable?

150k for a 1800 sq ft new build in the Red Oak TX area. ARV is supposedly 170k (I'm not counting on that). Income is expected to be 1400 a month. With property taxes, 5% vacancy, 7% pm, insurance, maintenance reserves, come out to about 5800 per year.. After debt service, cash flow should be about 300. That's not bad if the property can be a long term rental with relatively few headaches.

Do these numbers look right? Thanks in advance for your advice.

[Bryce Y.]

Their expense number seem a bit low as mentioned.  I have rentals close by in Desoto.  For 1% rent/price I'd prefer an older home in a better neighborhood, ie north Dallas.  You will be dealing with a better tenant class and more appreciation.