Buying 1st rental through a 3rd party BRRR Company

[Kevin Broome]

Hi BP Community!

Maybe there's another forum question dedicated to this, but I couldn't find it...  

I'm in my early 30s, new to real estate, and want to purchase my first rental property.  I have a very demanding job, BIG family and it's hard to imagine having the time to navigate the process start to finish.  I have lots of internet and BP podcast knowledge, but no real experience.  A friend of mine who I trust has acquired around 25 properties through a 3rd party company that finds foreclosed properties, bids, rehabs, rents and manages (on their clients behalf, the homes are purchased in your name).  My friend has positive cash flow on all properties and puts about 5-10 hours per month total into this and highly recommends the company.

I'm honestly not trying to skip out on the hard work and understand that I would be paying this company to help navigate the process on my behalf.   I know that some may see this as a slap in the face to the DIY real estate culture.  Ideally, I would like to learn and run the process all on my own, but with my busy schedule I thought this would be a good way to ease in and learn the ropes (with my first few properties).  The name of the company is SBD Housing out of Kansas City and I'm sure there are other companies like this as well.

Could I do all of this on my own? Yes.  But I also only have about 10% of the knowledge and time that I feel I would need to do this well.

Any experience with companies like this?  Good? Bad? 

I really appreciate any perspective and wisdom on this topic.

-KB

[Travis Dawson]

I haven't done this myself, but there are a lot of companies like this. Some good, some bad.

Key things to keep in mind: 

1. Your cash flow will be lower than if you did it yourself.

2. It will be hard to sell for a profit in the short term if you need to get out because you won't have much equity built in due to buying it for an inflated price.

3. They will put their profits above yours. Do your diligence.