Turnkey FAQ: Your Top Questions Answered

Turnkey investment properties are more popular than ever. With all this growing interest, it makes sense that more people are starting to take notice of this investment option - and especially those who have zero experience in real estate.

But here’s the thing about people with no real estate experience - they have lots of questions! Luckily, I have answers.

Here are the top 5 inquiries I get about turnkey properties, along with their answers:

1. What does turnkey even mean?

Answer: Turnkey properties are those that are 100% ready to be purchased by the investor. The property has been rehabbed, the marketing has been done, and the tenants have been selected (or are in the process of being selected). All that’s left for the investor to do is buy it!

2. So the investor doesn’t have to do ANY work?

Answer: That’s not what I said. While turnkey properties are ready to be purchased, it doesn’t mean that there’s no responsibility on the investor’s part. There IS work to be done by the investor, in the form of the due diligence and research necessary to make a wise property choice. The investor should absolutely spend time familiarizing themselves with the property and surrounding area, along with performing some calculations to ensure the property will be profitable in both the short and long term.

3. Are these turnkey properties too good to be true?

Answer: Nope. If you’re working with a reputable turnkey group, you should be getting a fair price for your investment. While this price will likely be close to market value and you may think you should be getting a better deal, remember all the work that has already gone into property - work that you don’t have to do and didn’t have to pay for.

4. How do I know I’m investing in a good property?

Answer: By doing your homework. Remember when I said it’s your job to research? This is where you find out if the property you’re eyeballing is worth it. Of course the turnkey company is going to tell you it’s a great deal - they want to sell the property, don’t they? But YOU are the one who needs to confirm that information. Another big part of ensuring you’re getting a solid piece of real estate is by hiring a third party inspector who will take an objective look at the property in question and let you know if there are any major red flags.

5. Where’s the best place to buy a turnkey?

Answer: There are a lot of markets that are hot right now...and many that are not. Turnkey investments aren’t in every market, either. Once you know which markets have the turnkey opportunities you’re interested in, you need to take a close look at the numbers. While most turnkey companies provide cash flow projections to prospective investors, they don’t all provide the market stats that are needed to make an informed decision. If you want your turnkey investment to pay off, it’s critical that you invest in a growing market, and not one on the decline - even if the cash flow projections look good.