Turnkey properties

[Jamie Henkin]

When buying a rental property from a reputable turn key company, is it necessary to go visit the home before you purchase?

And hire an outside inspector and general contractor to evaluate? 

[Dustin Cook]

If you don't visit the operation you are a fool, and I considered doing this too so it's good that you ask. I visited an operation in Indianapolis that is supposedly one of the good guys. The rehabs were awful. The sales prices were $10-20K over anything else ever sold in the neighborhood. The rents were $100-200 over all comps in the neighborhoods. So even if they managed to get a tenant in at inflated rents, it's only a matter of time until that becomes a problem. Basically if I would have bought site unseen and taken their proforma as truth, I would have been ripped off and been underwater with a negative cashflowing property. There are probably good turnkey providers, but I think you can do much better by buying off the MLS and having a buyers agent on your side. If you buy turnkey you have no representation and you will pay more. After my positive experience using an agent and going off the MLS and my negative turnkey experience I really am down on turnkey now. Especially in Indianapolis in the fall heading into winter the MLS has listings all day long at great deals with great cashflow, using actual numbers and actual comps. Spend a few bucks and go out there. Feel free to PM me with any questions.