Seasoned investors do you buy Turn Key properties?

[Par Attaran]

So upon reading the recent Bigger Pockets article about "The truth about turn keys no one tells you"

it appears as if the majority of turn key buyers are experienced investors?

I always assumed this was the opposite. If you were experienced wouldn't you buy properties that haven't been rehabbed yet and not pay retail?   I figured Turn keys were for the novice investor who doesn't want to deal with anything but writing the check.....

[Joe Kim]

I've bought 8 properties from 5 cities from so called "turnkey providers"

I would say in general if this is the gateway to REI, then do it.

I started in 2013 with turnkey properties and stuck with it until now.    however, I would rather not buy a turnkey property moving forward.  

The whole reason for tunkey properties and providers is the expectation of being "passive".  

Instead I got a lot of headaches.  Largely due to terrible or subpar property management, poor tenant selection, capex, frequent and sometimes inappropriate maintenance request, high turnover, etc..  By the way, all my properties in the 100K to 200K range with rents no lower than $1200/month.  all B to A- neighborhoods.

I just bought my first property (9th) this year just using my own investor friendly agent and had much more control over the property, tenant selection, and now I'm self managing the property from 3000 miles away and working out great.   Little bit of work I end up doing is a lot more rewarding.  

So called "managing your manager" is really annoying, time-consuming, and largely feels like I have no control (whether real or not).   You have to end up having faith in your prop. manager for the relationship to work.  Of course, you need question them at times and sometimes fight over some charges.  But at the end of the day, you are still handing your property over to their care.

"time consuming" is fungible.  Meaning when you are managing your manager, it feels like a lot more time wasted than when you are doing your own work actively managing your own property.   Your expectation is that you should be "passive" when you property manager is suppose to do the work.  However, when you start getting involved - it is really painful and frustrating.

Let me give you an example.   I needed work on severe wood rot in one of my properties (memphis), and the property manager (Marathon) was suppose to find a contractor who ..exact words on the contract:   Lots of siding on chase(chimney) that needs replaced, will take 9 pieces, 16 ft. then paint repairs $402.50

After the work was done I had my agent take before and AFTER pictures.  It looked identical to me.  

I asked the property manager what happened?   Here is the EXACT words I got from them.

"as outlined within the bid, most of the chase(chimney) has been repaired. They did not bid to repair the entire chase. "

So what investor wants a half-repaired or partly done repair on exterior siding?   I could not even understand it.  When did they say "most" in the bid?   they  said "lots"

I spent another $125, to get a home inspector do the exterior inspection.  here is what the report said (this is AFTER the first repair was done)

Damaged/Rotted composite wood siding noted at chimney at rear side of home. Most of this siding needs to be replaced. (See Figure

#8) (See Figure #9) (See Figure #10) (See Figure #11) (See Figure #12)

Today I got a new bid on the wood rot repair on the chimney and the price I got was $2500.   So clearly this was a bigger project that first reported to me.    

Bottom line is I'm willing to pay what i need to fix what I need to fix but I had to jump through so many hoops to get there.... this is not turnkey.  this is not passive investing.