Turnkey or not in IN, FL? ...the right PM...

[Neal Stanfield]

GOAL: Purchase a sub 100k single or multi-family turn key property in IN, or FL for long term cash flow, (appreciation is a cherry on top) before Dec. 31st 2019. (this will be my first rental property and I could finance or purchase the property. I’m considering both). 

CURRENT PLAN: I was recommended to a turnkey provider who builds and BRRRs properties in IN, and FL (and other south markets). He has an excel sheet with all his properties, all the numbers for my returns outlined, financing (if needed), contractos, etc., and said I won’t have to pay his PM dues if the property is vacant (incentivizing them to make sure my property always has a renter).

CONCERNS: 
1. How do I qualify a turnkey provider? 
2. How to find other turn key providers to compare differences? 

3. What “other things” should I be considering that are typically outside of a turn key solution. 

Thank you for your help, I am excited to hear from the community and dive deeper into the insights and recommendations.

Cheers, 

[James Wise]

Originally posted by @Neal Stanfield:

GOAL: Purchase a sub 100k single or multi-family turn key property in IN, or FL for long term cash flow, (appreciation is a cherry on top) before Dec. 31st 2019. (this will be my first rental property and I could finance or purchase the property. I’m considering both). 

CURRENT PLAN: I was recommended to a turnkey provider who builds and BRRRs properties in IN, and FL (and other south markets). He has an excel sheet with all his properties, all the numbers for my returns outlined, financing (if needed), contractos, etc., and said I won’t have to pay his PM dues if the property is vacant (incentivizing them to make sure my property always has a renter).

CONCERNS: 
1. How do I qualify a turnkey provider? 
2. How to find other turn key providers to compare differences? 

3. What “other things” should I be considering that are typically outside of a turn key solution. 

Thank you for your help, I am excited to hear from the community and dive deeper into the insights and recommendations.

Cheers, 

Tons of turnkey markets out there, not just Florida and Indiana. Many of these markets are very well represented by sellers & turnkey operators here on BiggerPockets so you'll have a ton of options as to which market and which provider to use and invest in. In no particular order I have listed some of the most popular markets for out of state investors

• Cleveland, Ohio
• Dayton, Ohio
• Toledo, Ohio
• Youngstown, Ohio
• Cincinnati, Ohio
• Memphis, Tennessee
• Birmingham, Alabama
• Kansas City, Missouri
• Saint Louis, Missouri
• Indianapolis, Indiana
• Detroit, Michigan
• Erie, Pennsylvania
• Louisville, Kentucky
• Milwaukee, Wisconsin
• Jackson, Mississippi

Each of these markets is popular with turnkey investors because of the low barrier to entry, high rental demand & high rent to price ratio. I recommend setting up keyword alerts for each area as they are discussed in the forums daily with advertisements posted in the BiggerPockets marketplace hourly.

One thing to note when looking at the individual markets, you can make or loose money in any market. Don't think that one particular out of state market will shoot you to success or abject failure. It's not really that complicated to buy out of state. It only becomes complicated when investors try to over complicate or over think everything. Whenever you are buying a property out of state you should do a few things to ensure it's as smooth as possible.

• Don't buy in the roughest neighborhood in the urban core. Pick a solid B-Class suburban area. Perhaps a nice 1950's built bungalow.
• Always hire a 3rd party property inspector to give you an unbiased feel for the home. The reports are 40-90 pages long and go through the entire house in great detail.
• Get an appraisal. If your using financing the bank requires this. This is good. The bank isn't going to let you blow their money. They have more skin in the game then you do.
• Make sure you get clear title. If using a lender this is a non issue. They will make you do this. It's those maniacs that buy homes cash via quit claim deed off of craigslist that really get screwed.
• Make sure your property manager is a licensed real estate brokerage.
• Google Clayton Morris and/or Morris Invest for a cautionary tale of what not to do when buying turnkey real estate
• Understand you can not eliminate all risk, only mitigate it. If you are risk adverse real estate, (especially out of state) is not for you.