Recommendations for Good Turnkey Companies in Indiana

[Kendra Mattson]

I have 2 properties I manage myself in HCOL areas in California. I'd like to expand my portfolio by finding cash flow out of state. I've been looking particularly at NW Indiana, but am intimidated by the distance and lack of familiarity - ex. what potential issues are there in places that snow? I have no idea because I'm a Californian born and raised. So I'm likely going to go for turnkey management at least for the first one or two out of state properties. Do you have a company you would recommend in Indiana? Any specific cities to look at or other advice for turnkey or out of state investing would also be welcome.

Thanks in advance!

[Bryan Blankenship]

@Kendra Mattson What @James Wise said is a great place to start! 

Research. Research some more. When you think you've done enough, research one last time. That means calling/emailing any turnkey company you might be interested in and asking all of the tough questions you'd ever need answered up front. Don't dive in without having a thorough understanding of the realistic expectations you should have when investing with them - do they know the area REALLY well? Do they have more than a dozen properties under their management? What warranties and guarantees do they offer? Will they give you a tour if you decide to visit?

I know my market like the back of my hand. I was born and raised here, as was most of my team. We know the difference between Lynn Drive and Lynn Street in the same small town of 12,000 people that's the suburb of a really desirable area.. but Lynn Drive will get you $400 more a month in rent than Lynn Street. Those little things mean a LOT when you're picking a turnkey company. We gave a tour to 20 people in March on a bus. We gave a tour to a client and his wife and friend in April. Another is happening this weekend, over the holiday. After that, there will be one in the second week of June. I LOVE showing people properties and areas so they don't just have to take my word for it, they can see it all for themselves. Any good company should. If you can't make it out for a tour, you should definitely be able to get videos and photos. I've had clients call police stations, city halls, and schools before just to make sure they were 110% comfortable with the neighborhood they were purchasing in!

Inspectors and appraisers are a third party that are very helpful, as James mentioned. 

I also second his recommendation of a nice B class property. I like to call those the "bread-and-butter" of the heartland. They attract solid tenants, aren't as pricey as A class, and provide great returns.

DON'T EVER go for anything below a C Class. The price tag is tempting at first glance, but those returns you THINK you'll be making will vanish quickly due to repairs, turns, vacancies, etc. CAP rates that you're looking to hit on a B class will be somewhere between 7-10% most of the time. If you see 13%+, it's fake.

Summary - due diligence. Take your time in making a decision. Get comfortable with the process and the company you want to invest with. :)