All Forum Posts by: Clayton Mobley

Welcome to BiggerPockets @Ramon Penn, you're in the right place for what you are looking for. I understand exactly what you are talking about, no one should have to work to live. You shouldn't have to work for your money, your money should work for you.

I think the BRRR method is a great option for you, you have the skills to do the work yourself and even have a great network to contract some work out that you may not want to do. You have already started some REI research, but take full advantage of all of the community and resources BP has to offer.

Best of luck.

Hi @Robin Gravlin, there are many great full-service turnkey companies to choose from, it just depends on which OOS market you would like to invest in.

In the meantime, here are a couple of blogs that may help you with your decision making process:

Kyle Myers' personal journey through REI - Part 1:

https://www.biggerpockets.com/member-blogs/8313/49711-part-1-living-the-vacation-life

Part 2:

https://www.biggerpockets.com/member-blogs/8313/49783-part-2-choosing-a-turnkey-company

I think his personal experience could give you an idea of what you should keep in mind while choosing a turnkey company.

Best of luck.

Hi @Bernard Meeks, welcome to BiggerPockets, thank you for your service. You're in a great place to connect with seasoned investors, newbie investors who may have the same questions you have, and even companies that can be an amazing resource for you. Take full advantage of everything BP has to offer.

Best of luck.

Hi @Ben Thanyawatpokin, I agree with @Joe R., due to your current location, the turnkey method may be a great option for you. I am a bit biased when it come to the turnkey method, but I recommend it when I see it fits for certain investors. Full-service turnkey means that you don’t contract any of the rehabbing and repairs for the property, the turnkey company does all of this work. The turnkey company has networks and systems in place to find the best properties and rehab to a high standard and quality. 

The turnkey method is a very good option for investors who work a full-time job, don't have a lot of time on their hands to rehab and do a full renovation and are looking to invest OOS or even internationally. Investors who choose turnkey are probably looking for passive income or they live in more expensive markets. This all depends on your goals and what you would like from your investment. Before you decide, have a discussion with yourself about what your objectives are in REI. Also, don't hesitate to ask ANY questions. If you have a question, 9 times of 10, another person has the same question on BP.

Best of luck.

Hi @Hunter Schulz and welcome to BiggerPockets. Your investment goal is very achievable and you have joined a great community to get your investment questions answered. If you are looking into OOS markets that are possible to invest in, here is a list that may help you out:

• Cleveland, Ohio
• Dayton, Ohio
• Cincinnati, Ohio
• Memphis, Tennessee
• Birmingham, Alabama
• Saint Louis, Missouri
• Indianapolis, Indiana
• Detroit, Michigan
• Louisville, Kentucky
• Milwaukee, Wisconsin
• Jackson, Mississippi

There are even more cities that you can look at, this is just a starting point for you. You referenced that you were looking at a few turnkey companies, may I ask which ones you were looking at? 

Hi @Kenneth Biason, there are pros and cons for both options. The issue many people have with turnkey is that forcing appreciation and selling quickly for a profit has been removed. The turnkey company has done this for you, this is how we make our money. 

The BRRR method is good for a person who has a lot of free time, they're handy, and know
people and have a good network of people who they can contract to do any extra work they don’t
know how to do. However, the risk is that the rehab process can take long, all of this time
means that you aren’t making money on the property. The longer it takes, the longer you have
to pay out of pocket for the mortgage (if you financed). When the work is done, and done right,
you will have a better return on your investment. You have traded a LOT of time and energy
and risk for a higher potential reward.

I will say that I am a bit biased about the turnkey method. The turnkey option means that you don’t need to do any of the work I mentioned above. The turnkey company does all of the work on their time and dime. The turnkey company has networks and systems in place to find the best properties and rehab to a high standard and quality. This also means that you won’t have to worry about vacancy risk during the rehab process.

The turnkey company benefits from the spread between what they put into the property and the market price they sell to you. Your returns will come from cash flow each month and, presumably, long-term appreciation, this is not guaranteed. Going with the turnkey option means that you've traded extra potential return from forced appreciation for the luxury of having your time and energy back and having someone else do the hard work for you. Before you decide on turnkey or BRRR, have a discussion with yourself (and/or your partner) about what your objectives are in REI.

Best of luck.

Hi @Joseph Taylor, you are not alone, a lot of investors are in the same boat. BP does have some great tools to help you with any mathematical equations that come your way, check the 'Tools' area above. Also, whenever you have any deals you would like calculated, but you are having problems calculating yourself, don't hesitate to post the numbers on BP. The BP community is always here to help you.

Good luck.

Hi @Jason Weeks, sounds like your colleague had a very awkward experience unfold in front of her. You are very correct, doing your due diligence to vet out prospective tenants can potentially keep this story out of any investor's future. Thanks for sharing.

@Bryan Lynch we're a full-service turnkey provider - so while I'm definitely biased toward turnkey, it definitely isn't for everyone. Whatever investment strategy you use, I think both Bham and Huntsville are worth a look. 

@Bryan Lynch Of course I'm biased but I wouldn't have started a company in Birmingham AL if I didn't think the market supported turnkey investments at scale. We're now also in Huntsville and really excited about what we're seeing there, so even if you're looking to do it more DIY (like BRRRR rather than turnkey provider) I'd recommend looking at both cities. They're tertiary markets, which means much less volatile highs and lows, so as we near the top of this cycle, we should maintain our values better than over-inflated markets like Seattle, CA, HI, etc.

We're all for appreciation but we prefer slow and steady to fast and volatile (because timing the market never works), so cash flow is the name of the game for us. Solid B class properties come in around $90-$120k or so in both markets, rents right around 1%. Obviously you'll need management either way if you're OOS so focus on people first, even before market. But that being said, AL is definitely worth a look no matter what strategy you're looking to use.

Good luck!