How to consider a property as turn key

[James Li]

Me and my wife invest SFH rental locally. Most of the properties we purchased have an age within 20 years. In order to diversify our portfolio, we are thinking to invest out of state. We search so called turn-key properties and had spoken several turn-key providers. However, we do have some concerns on turn-key properties and hope sophisticated investors can provide some insights:

1. Normally turn-key properties providers provide have an age range of at least 50 years. However, when talking about the renovation done in the property, seems no plumbing or wiring replacement has been done. Basically, the turn-key properties just are done with the replacement of roof, water-heater, and/or kitchen/bath reno/resurface. This would concern me a lot that issues with plumbing and wiring would definitely happen down the road.

2. Normally the turn-key companies collaborate with local providers and contractors. when talking about signing the purchasing contract, the parties on the contract would be only the investors and local provider, rather than the turn-key companies. This concerns me a lot if something bad happens in the future.

3. Since the contract is only between investors and providers, what is the role of turn-key company plays in the business? Referral benefits? 

4. Management company also is local and turn-key companies have no control with the local management, why investors need to have turn-key companies as their contact and let turn-key companies to deal with local management? No guaranteed at all since turn-key company cannot control over the local management/providers

5. What about the appreciation of so called turn-key properties compared to the properties with the age of 10-20 year?