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Updated over 9 years ago, 05/05/2015
Retire-on-Rentals?
Has anyone had any dealings with this company? They are based in Charlotte, SC and rehab SFH, find tenants and sell them on together with the leases, and continue to manage them. The homes are generally in the +/- $100k price range, and rents offer a reasonable ROI. I'm guessing appreciation won't be big, but as a hassle-free toe-dipper investment, the risk seems negligible given the small amount invested. I'm sure there's lot's of downsides, but has anyone used them, or any companies offering similar services?
i agree with you mike...i think these turnkey companies are asking too much...they probably paid between 20-30k for the property...they should be selling around 60k in my opinion ...i don't haev a problem with them profitting--they deserve it for fixing up the property...but earning too much on a small deal isn't good business...it's like the wholesaler trying to get a 10k wholesale fee on a 50k house..
So then, what are the good areas / zip codes / neighborhoods to look at an Charlotte?
And which ones should be avoided?
Not going to speak to return on investment. Instead, I will speak to the integrity of the principal of Retire on Rentals, Sky Mikesell. I have worked with Sky on many occasions over the years and he has consistently proven to be a high integrity, straight shooting man of his word. Evaluate the investment as you would any investment, but know you are dealing with a character driven company.
Maybe Bill because you are a lender, but as an investor with Sky, I have been disappointed often. He continues to overpromise and under deliver. The promise of seeing the rents the 25th of the month has become regularly the 15th of the following month, and for 6 of the 20 months I've been an owner for his property management company I have barely covered my mortgages (4 in total that I invested in with Sky based on the promises), so I have a very different view of his integrity and words kept.
Hey Joe, I have not bought from RoR but I have corresponded with them quite a bit and they seem good to go. Can't confirm for sure, but remember with turnkeys, ultimately the company you buy them from doesn't matter if the property and paperwork check out. The only thing that matters is the property management company, and worst case they suck, you fire them and hire a new one. I wrote an article about it- http://www.biggerpockets.com/renewsblog/2013/04/20/due-diligence-turnkey-property/
As for everyone else, realize that turnkey options may not be your thing, but they are definitely a good option for some. Like me. That's all I buy. Yes, they are priced higher (John Chan), but there is a reason for that- you don't have to put ANY time into them. For someone like me, who could make more money per hour doing something else than sweating over a property, it's a great option. Or, more importantly, for someone like me who has ZERO desire to sweat over a property. I want to be hands-off. If you understand 'passive' cash flow, you know that 'passive' does not involve 'work', which is what you would have to do in order to save that little extra bit of money. Wrote another article- http://www.biggerpockets.com/renewsblog/2013/02/16/turnkey/
The point is, turnkeys aren't for everyone, but they are for some. If Joe is wanting to know about a turnkey company, he isn't asking if he should be investing in turnkeys or not.
#3 Off Topic Contributor
- Attorney
- Viera, FL
Ali,
I'm not adding anything to the discussion but I saw the name of your company, "Hipster Investments". Is that where you own the property but wear the discarded clothes the tenants leave behind in order to be as ironic as possible? ;-) (Friendliest of intentions there with that comment. ;-) ).
Tim
I understand why some investors might need to go the route of a turnkey company to buy SFH's. The numbers simply may not work in your area (i.e. california) and trying to manage the purchase and rehab is a bit ugly.
But why pay over retail for the homes? For those of you on BP, why not try to find another investor and offer to pay them a flat fee of say 5 to 10k to: find the house, manage the rehab and get it rented. And, after that, you can turn it over to a property management firm (maybe even the turnkey ones).
And one nice feature of it is you can go where the money is. So if the market in Texas is too hot, go to Atlanta, or florida or north carolina. Probably makes more sense to keep in one state in case you want to visit.
But, theoretically, you could do it if youw anted. I'm sure you can find an investor on here in any of the states to do just that for you.
Doesn't it make more sense to pay 5 to 10k for the deal than to pay 30 to 40k which is about what those turnkey companies seem to be charging on their deals.
And an investor will give you a more realistic number on your appraisal value and on the rents than one of those turnkey companies.
It just seems to me it makes no sense for an investor to have to pay retail - in any market. There has to be a better way to passively invest out of state.......
Just a quick comment on Sky Mikesell and Retire On Rentals - Run for your life! I am still working through the mess he created.
I bought from Sky Mikesell and Retire on Rentals and would not recommend him. They provided me with an appraisal of 110K on a property, I got in thick with them with deposits and purchase agreements and when I financed, the bank provided an appraisal of 84K. So buyer beware, his pockets got fatter and it was downhill from there - under-provided/unclear improvements and eventual tenant eviction proce$$.
At least I own the property but I learned a good lesson in the process.
You stated that you buy from Turnkey - could recommend a solid operation and perhaps any guidance or advice? Thanks so much for your time, I really appreciate it.
@Account Closed
There are several great markets and providers around the country. We all have our own thoughts on who is good and what city is a good market. You should ask @Jay Hinrichs his opinion as he has truly been around the block and has a ton of experience and knowledge of many markets and providers.
- Curt Davis
@Account Closed
Sure. Send me a PM.
