Charlotte Turn-key companies

[Chris Strokes]

Can anyone provide any recommendations/experiences with Charlotte turn-key companies?

[Alex Franks]

Originally posted by @James Paine:

@Chris Strokes with the home value increases most of the TK providers in Charolette have gone away.  The lower cash flow made it harder to sell their product. To add on to @Ali Boone 's post. 

Good luck!

Jeff,

Look at it a few ways~ most of us, turnkey guys did exit the business they changed and moved on when nothing was left to buy. I sat with Invitation Homes who were a branch of Black Stone. They purchased 7,000 properties in nine months here in Charlotte NC. So basically there was no market left here in Charlotte, NC. Now we could have gone with and done like some of the resellers which were and are selling the low-end, over-priced deals. Being I have been in the game for sixteen (16) years I understand it a bit better than most. So for us moving on to Apartments , and New construction made more sense. Pretty much most of the turn key folks in all the different markets we see what is out their. 2007-2008 inventory is all buy gone.

Some of this I posted before but I did highlight a few new areas.

Here is a simple take on the market:

We were approached by LA reseller in late 2008. Back then everything was sold retail, very few investors were selling but instead building their own portfolio. Now the lower end deals I was flipping using hard money to local guys who were buying investments 2000 -2004. I did not buy my first rental until 2005, but in two (2) years I had thirty-seven local deals in my small southern town.

Next point- the mess started in 2007 - 2008 when most of the product was created that is basically gone now  So most of that was cleared up in 2013. Now that being said, I see the same lower end crap returning and being sold as great turnkey deals. These type of deals are going to cost folks a lot of money. Again, nothing to do with the asset, but more to do with the mindset of the renters. I actually know a great group in Charlotte that sells those type of deals hey are doing well for them selves and their clients. I just prefer what I call pretty assets and A-B product only. Which is what we like to call them  retail properties.

So why sell turnkey or through a reseller? No need we make better money selling retail. You guys are looking for a product that in  most markets don't exist. Look at most resellers or turnkey with the exception of one or two companies. If most turnkey guys would just invest their funds into marketing themselves; they basically cut any resellers out of the mix. Keep in mind, turnkey guys pay most folks $5k - $8k per deal (Yes, per deal!). So if the turnkey guys used these funds for their own marketing then no need for resellers. They would all be advertising in the same magazine (we all know the three popular ones) and selling to the same folks who we all talk with (West Coast, Northern USA investors and or international investors). Keeping in mind marketing and sales is under utilized skill in this business.

Most of what is selling lower over-priced assets or a nice product that is super over-priced. The problem is even over-priced.  These numbers can't be achieved in most folks markets hence the turnkey product.

I think the window for solid deals has passed their are still deals but just harder to find. Most of the folks selling or giving you advice here are selling an asset or being paid referral fees to sell that asset (nothing wrong- it is a business and they are providing a service or the asset itself). During 2009 - 2013 was the prime time to purchase the solid cash flow rentals. Right now folks are way over paying for higher class assets or buying the lower end scraps. Yet I just got sent me a great charlotte deal so they are out their.

Better money in retail sales in most markets, which is similar to 2005-2007. Folks sold these same assets to subprime buyers (lower end) or retail to home buyers (A-B) asset (  Now look up B2 R ( branch of blackstone)they are now coming out with lending  for their renters and doing loans under 40k ) Which should tell you the mess wont be the same but there will always be product coming out.

In 2009-2013 if you purchased during this time I think you made great buys. As well as hitting the timing of the market correctly.

Real estate is a lot about timing and cycles our market the cycle ended for most good deals in 2012 when the hedge funds came in ( what I was buying for 50k rehabbing for 20k selling at 85k )Now they are pre rehab $110k or higher . At the same time the market tells folks what is working and what is not. You have to listen and not recreate the wheel. Still good deals just harder to find.

Just my two cents

Alex