All Forum Posts by: Mike McKinzie

Actually, this TK investment was AFTER my Podcast and it was only my second "authentic" TK purchase, the first being in TN.  Plus, both TK companies are active members on Bigger Pockets.  If you are looking to get your Down Payment back, solely through cash flow, your numbers are fairly accurate.  Imagine how long a payback is when you pay all cash for an investment!  Why did you say "seems strange they would put on a TK investor?"  I have been investing in Real Estate since 1980 and bought my first TK in 2015.  Turn Key is just another avenue of finding real estate deals.  Personally, I don't care for it after my two experiences, but I was willing to give it a shot.  Now I am going back to actually getting my hands dirty and being more directly involved with my investments, like I was the first 35 years.

And I will ask you the same thing, did you purchase a property through Pinnacle Investment Properties?  If you did, we would love to hear your experience.  If you did not, why are you even posting here?  This thread is about folks experience with Pinnacle Investments, it is NOT about judging people who have had an experience with Pinnacle!

 Yes Matt, you can get a lot of KC stuff online.  My 'due diligence' is just about checking out a 'single house.'  I love the neighborhood I bought my homes in, it was just the bad condition of the houses.  Just this year, one of the houses had a collapsing septic tank which I had to have removed as the backyard was getting a sinkhole making it a danger to the kids playing.  Another $2,500 in repairs, if you include the resodding.  No where online did it say this property had an old septic tank, from a previous home on the property.  I am not sure why this thread has diverted from the OP's question.  They just wanted to know anyone's experience with Pinnacle.  If you had an experience with them, then post it for everyone to read.  If not, then why are you even posting here?

There is a high probability that we will be moving to the Denver metro area sometime in the next year. My daughter and her husband already live in Arvada and another daughter lives in Colorado Springs. I also have an Uncle/Aunt in Fort Collins. I would love to "chew the fat", so to speak, with successful investors in that general area, I don't need a Retail Realtor. I am currently licensed in California and used to have my Colorado Broker's License. And since I bought my first investment back in the 1970s, I don't need education on investing. I just need education on Demographics, market trends and networking with local 'bird dogs,' 'wholesalers,' and investors. I already have access to MLS, Zillow, and other online sites, so there is no need to send me redundant information. But if you want to network, maybe share knowledge or even try to make a successful investment, PM me.

 I am not sure what you mean "read carefully?"  Do you think I am being untruthful?  I was only giving MY EXPERIENCE.  I even said other's may have had a different experience than me.  For Turnkey providers to be successful, they have to keep their repair costs as low as possible, I understand that.  BUT, they also need to do a good job if they want to stay in business.  Sometimes a contractor cuts a corner just too much and leaves a job inadequately repaired.  The foreclosure inventory from 2008-2010 is basically gone now, so TK providers are really scrambling to find  good deals, along with much tighter margins.  Now is a tough time to get into the market, it requires a LOT more research, more work and more due diligence.  

I have purchased two investments from Pinnacle and was not pleased with the outcome.  I will not mention any names but the "rehab" done on both houses was what I call "duct tape and bailing wire" quality work.  Each house was done by two different "contractors" but the jobs were 'hurried', 'inadequate', and insufficient.  After my purchases, I had to spend another $20,000 +/- to get the homes repaired.  On top of that, Pinnacle put tenants in both houses and both tenants bailed on me during the first year, one after only 3 months.  Also, I had to fire the Property Manager that came with the purchases as they were extremely non responsive to my inquiries.  Currently, things are operating much smoother, but I bought these back in the beginning of 2017.  Maybe other's have had a better experience with them, but unfortunately, I did not.

Lots of good ideas here, pros and cons on all sides. Everyone has different goals, different ideas and different ways to achieve them. A few things to remember, always calculate your Capitalization rate on CURRENT VALUE and not on what you paid for the property. For instance, if I paid $100,000 for a SFR that rents for $1,000 a month, using 50% for all expenses, I have a 6% cap rate, $6,000/$100,000. But if that property goes up to $200,000 in value and the rent has only risen to $1,200 a month, I have a Cap Rate of 3.6%, $7,200/$200,000. One possibility I have not seen is to sell your current rental, use a 1031, add your cash to it, and buy a nice, multi family property, or buy several SFRs. If you have only one rental and are young, wanting to add to your portfolio, I would advise you to buy four more properties, put $50,000 down on each, with a buying range of $150,000 to $200,000, and get a minimum of 1% of purchase price in rent. I did this when I sold a Texas property and bought 2 SFR's in Missouri. With no money out of pocket, I raised my monthly income from $1,500 to $2,200 with no raise in debt service and got a lot LOWER property tax bill and lower insurance costs. With all my costs, all the numbers, bottom line is that I raised my net monthly income about $1,000 without costing me a dime. This took some work on my part, but Real Estate Investing is NOT PASSIVE if you are still buying and selling. It only becomes passive if you are done buying and selling, have all of it under GREAT management, and are resting on a Caribbean Beach!

Done.  Great survey.  As an Orange County Agent who also invests in many other states, I would love to help other investors.

My biggest problem with turnkey's is the poor rehabs.  We purchased 2 turnkey properties in the Kansas City area in 2016 and have so far put almost another $30,000 in repairs that should have been done by the flipper.  I made sure to buy in a good area (Belton, MO), but the rehabs were rushed and incomplete, to say the least.  Also, the PM was a huge problem.  I finally fired them and found a start-up PM company that so far has been really good.  That is a milestone, they were the 10th PM company I have fired in the past 8 years.

I just finished working with a lender in Dallas, TX who is totally locked up with FNMA rules.  My situation is unique but I only have 4 recorded Trust Deeds and am looking to refinance (actually, finance a free and clear property) in the Dallas area.  If anyone has a referral, I would appreciate it.  I have a source of funds, so don't give me anyone who can give me 8%, 9% or higher money because I can beat that all day long.  Thank you.