All Forum Posts by: Chris A.

@Rob Hakes I would say before starting on anything - make sure you know your own personal criteria and what exactly you are looking for in your RE investment. Make sure to ask all questions and clarify anything you are not comfortable with. Working with turnkey providers, properties go fast - you need to be able to receive the available properties, crunch the numbers, then make a decision. This is why knowing exactly what you want is key and also never feel rushed - wait for the right property to come. 

Things like:

1. Expected COC returns

2. Estimated maintenance/vacancy savings

3. Specific criteria for type of house you are looking for

a. Age of property

b. Septic vs. connected sewage

c. school district, neighborhood, etc.

@Jacob Glawson Exit strategy is one I struggled with. But bear in mind that this is a long-term investment and typically with turnkey properties you dont bank on appreciation. That being said the three exit strategies that come to mind:

1. Sell to another investor

2. Sell to a person looking for a home

3. Seller finance to tenant

I agree that I do not know if down the line I will be able to sell the house at what I purchased for and the fact that it was purchased at a significantly higher price than what other homes around the area sell does worry me a bit. However, I figured the longer I hold the property the less of a risk that becomes. I went into turnkey investing knowing that the principle I put down for the investment would not be liquid. 

Because I am an OOS investor - could you elaborate on the areas Spartan rehab's homes. From my research they seemed like your typical B neighborhoods - crime rates are low and school district (at least the one where my property is) are good. 

@Clayton Mobley maybe you can weigh in to answer Jacob's question.

@TJ P. You are absolutely correct on your assumptions - depending on how much you are putting away for maintenance and vacancy I am making between 160 - 200 a month CF. I wasn't too worried about not meeting the 1% rule because it was pretty darn close and mainly because I believe in the ability of Spartan's PM company to take care of my property and manage consistent CF per month. Looking back at it now there could have been many different TK providers that I could have gone with that would have offered better returns and properties that rent for sometimes even higher than the 1% rule. I still believe there are many opportunities in the market to achieve what you are looking for. I would definitely talk with different providers and give them your criteria - I don't doubt you will be able to find an investment that fits your needs even with the recent "tightening" in the markets. My two cents would be find a good lender to work with and be patient and wait for the right investment to come along. Make sure you trust and believe in the work of the TK provider you end up going with - at the end of the day it is the PM that will make or break your investment - at least that is what I believe.

If you can build your own team to buy and renovate properties then find a good PM to manage them obviously you can far exceed the returns you are looking for - but i guess the reason for you going TK route is you want very passive - like i did. 

I will make sure to update this post every now and then but if you have any other questions feel free to DM! I will help in any way I can.

@Larry Fried good catch! Yes I did! Thank you (: for the catch and all the previous help you offered me when I first started! Can't believe that was only 2 months ago!

05-18-2017

Got off a call with the PM today. 

They have a tenant on a 2 month lease and 1st month was collected and distributed. 

From getting a property under contract to this point everything has been very smooth and I couldn't be happier. I will update time and time again to keep everyone up to date with how the property is doing. Hopefully this was helpful for anyone considering getting into turnkey and provided a look into the process. 

If anyone has any questions feel free to ask in the thread or DM. I've received so much help in getting to this point and looking forward to contributing in any way I can.

Cheers! Happy Investing!

@Kenneth Dai I think I have - Spartan thus far has been great and I truly believe in their message of acquiring clients through a reputation of quality. Time will tell but I trust in Spartan's ability to deliver quality service and investments. 

Considering they bought the foreclosed property at $34K and I am buying it for $82K - no clue how much they spent on the renovations (maybe around 20K?), but seems like Spartan was able to make a pretty nice profit? 

Cash flows work for me so I guess good deal for both parties.

Would love to hear peoples thoughts

@Gautam Venkatesan

PM fee: 9% of monthly rent

Lease Up fee: 1st months rent (they only sign 2 yr contracts)

Same Tenant Renew: $500

They didnt list a eviction fee in their agreement. Maybe @Clayton Mobley can weigh in? 

@Gautam Venkatesan Thanks for looking out, my 3rd party inspector just finished his inspection and I have forwarded the report to Spartan. Waiting to discuss what items should be addressed before the sale moves forward to close. What items should I expect to be addressed with no questions asked?