Info on starting in turnkey rentals?

Question

I have been house flipping for 3 years mostly high end finished flips in trendy areas of town.  Now I'm exploring getting into doing turnkey rentals.  I know how to buy, I know how to rehab and I know property managers but where can I get some info on putting bit all together?  Is there a book or BP podcast on the subject?  I am in Omaha, NE which has a tremendous rental market so I'm eager to learn.  TIA

Stefan Folkert · Answer

Hi guys,

starting my real estate journey in the us after some Caribbean adventures.

i am looking at turnkey and exploring options.

I'd love to hear more about Nebraska. And general experiences.

Ali Boone · Answer

Hey Zach. I've mostly bought turnkeys for myself and have been helping people buy them for years. Happy to share random stuff that I know we look for with turnkey providers. The big thing to start is just making sure you're doing it in an area with enough distressed inventory that you can keep a revolving inventory to some degree.

Lance Peterson · Answer

@Zach Hergert

Hey Zach, I just bought two properties in the past year so I won’t be able to buy another for a little while, but would definitely be interested in working together if you go through with the turn key idea

Greg Dickerson · Answer

@Zach Hergert the key is finding the right properties at the right price. You need enough margin for you to buy, fix up, rent out and sell to the investors and make a profit while leaving for room for investors to cash flow as well. Then you need a steady flow of investor buyers. It’s all about systems and marketing just the the flip business.

Dan Zitofsky · Answer

@Zach Hergert being I built this for myself and others aside from managing properties for them I can help with some pointers.

If you want to manage as well for investors, you want to be careful. I always saw this as a possible conflict plus I wouldn’t do the best job for them managing. If you do this, I’d recommend getting properties in class B and better areas. I personally go overboard on the rehab where I like making each property as maintenance free as possible. It will reduce the issues with tenants and maintenance calls. Some prop managers love maintenance calls as they tack on 20-40% to each repair. This will lose you consistent investors and very short sighted. I say this as I have a pretty large portfolio now and have an average length of stay over 6 years, a 97.2% occupancy rate, just over $1,500 in turnover costs per door and I out rent my units in a market by $50-$76 for myself and investors who I help acquire a portfolio.

I do know Oklahoma is a good market even though I haven’t done anything there yet. I’ve been so busy in other emerging markets that I haven’t even extended there but with the right mindset and model, I’m sure you’ll crush it. Wish you all the best.

Travis Brizendine · Answer

@Zach Hergert What aspect are you caught on? I’m from Omaha and I do Mortgage, have plenty of real estate agents and connections.