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Updated about 5 years ago, 12/06/2019
Interested in a turnkey investment, any recommendations?
I’m new here to BiggerPockets & looking for some insight.
@Jason Theus
@Jason Theus
Check out “Turnkey Revolution” by Chris Clothier.
#1 Questions About BiggerPockets & Official Site Announcements Contributor
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#1 Questions About BiggerPockets & Official Site Announcements Contributor
- Real Estate Broker
- Cleveland Dayton Cincinnati Toledo Columbus & Akron, OH
Originally posted by @Jason Theus:
I’m new here to BiggerPockets & looking for some insight.
Tons of turnkey markets out there. Many of these markets are very well represented by sellers & turnkey operators here on BiggerPockets. 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.
- 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.
Originally posted by @Jason Theus:
I’m new here to BiggerPockets & looking for some insight.
Turnkeys are a great way to invest OOS, or just as a way to have passive investments. I would suggest going with a TRUE Turnkey Provider. They should do everything in-house. They should own the property first, renovate it, place a tenant, and then sell it to you. They should also provide the property management in-house and not use a 3rd party.
Try looking at:
Assessing the Risk of a Turnkey Real Estate Company
5 Keys to Turnkey Real Estate Investing
Much needed info!! Thanks
Can we refer companies here on BP?
I’ve been talking w/ Morris Invest & looking @ roofstock.
Originally posted by @Jason Theus:
I’ve been talking w/ Morris Invest & looking @ roofstock.
Stay away from Morris Invest. Stay far far away (unless you like losing money...)
A quick search online (Morris Invest fraud) or a quick search thru BP Forums will provide you with all the information you need.
Good luck out there...
@Jason Theus First, welcome to BP! Not sure if you've already begun your real estate investing journey, but if not, congrats on taking the first steps!
The best advice I can give you is RESEARCH, RESEARCH, RESEARCH!
There are a ton of turnkey companies in markets all across the country, and not all are going to accomplish your goals or offer the same benefits.
It all starts with you and your goals. What are you looking to achieve? What markets are you interested in? What is your available capital? What is your strategy? Some like Cash Flow, some buy for the appreciation. Each market can offer something unique that speaks to your strategy.
Then you have to find a company that meets those goals and find out what they offer you in return. Some will guarantee the rent/maintenance as part of their management of your properties. Some do higher-end renovations to address major capital expense items. Some are in lesser-quality neighborhoods which impacts your vacancy and maintenance on the property.
The great news is, you have the leverage in these conversations, so take your time to find the best one for you!
Let me know if you have any questions! I'm more than happy to help!
@Forest Skufca, thanks for the advice & I sure will reach out to you soon.
@Chris Hedlund, thanks. I’ve read some bad things about them recently.