All Forum Posts by: Jay Zoo

Hello BP,

Thank you all for your sound advise. I wanted to share some updates on issues I had with RWA and Jason Hartman Network.  I spoke with RWA and Jason Hartman network teams for the past 1-2 weeks and they have alleviated most of the costs of the renovation.  I am still responsible for portion of the renovation cost and vacancy costs but it is much better situation than originally proposed.  PM offered to initially cover the renovation cost and deduct the balance from future rents so I didn't need to come up with additional funds. PM also offered to waived the new lease up fees for the future tenant. 

I also wanted note that Jason Hartman's team, both Jason and Carrie, really took personal attention on resolving this issue and I appreciate their effort and time on resolving this issue.  I was previously discouraged on contacting them for help as noted above but I don't think I could have untangled these issues without their help. We are starting the renovations this week  and hopefully the have a tenant in shortly.        

@Jason Hartman 

Thank you for reaching out. I sent you my contact info. 

@Jay Hinrichs

Thank you for your reference. I would like to merge all properties into a single PM eventually but I wasn't sure which PM was reliable. I read extensively on this forum but I still couldn't decide. I read your numerous posts on turnkeys that PM is probably the most important factor. So, I purposely bought from different turnkey companies so that I can see firsthand which PM was reliable. 

@Ray Johnson

Thank you for your reply. I previously spoke to Mike (Parc management) about the taking on other houses but I believe Parc only manages their internal inventory and doesn't accept management contracts only. Yes, I ran the numbers again with the renovation expense and at perfect scenario, it looks like it will take 3-4 year to breakeven on this project, most likely in 5 years or more. 

@Jay Hinrichs

Thank you for your reply. For my previous issues, my advisor at Jason Hartman did try to help but ultimately nothing really happened. In hindsight, it made the communication even more complicated trying to relay all of the messages between each other. 

@Chris Pflum

Thank you for your reply. I will request my PM to make sure that the property is winterized. I will check with my attorney if this can be resolved legally. 

Hello BP!

I have recently purchased 3 turnkey properties from 3 different companies 6 months ago in Indianapolis and here are some updates. Also, I have a really large problem with one of the vendor/property and I desperately need some advise.  

1) Pinnacle Investment Properties (Mike Darrigo) Purchased in May 2018

I purchased their "B+" neighborhood property and I inherited the tenant. During inspection, we found issues and it was addressed before closing. Mike patiently explained all of the details during the process and the property is performing as discussed from the start. Thus far, all of the transactions from purchase to closing and transition to property management (PARC) was really seemless. This is what I imagined in a turnkey property. Stress free experience! If anyone is looking for indianapolis turnkey, I highly recommend Mike Darrigo!

2) Real Estate Done 4 U (Michael Drew)

I purchased a "B" neighborhood property and I inherited the tenant on this one as well. I believe I didn't purchase a typical houses they offer. The property manager is Bricklane but i think they changed the name to Home river. I inherited a so-so tenant but I was notified beforehand. The house was not in good condition but I received a credit for the future turnover cost. (hopefully it is not more than the credit). The whole transaction and communication though out was not perfect but it went through. Because the house was not in good shape, there were some high repair bills. Thus far, its been more headache and expenses than I anticipated but its going okay.  

3) Jason Hartman Network / Realty Wealth Advisor- Zuluscape.  

I purchased a "B++" neighborhood property through Jason hartman network. The turnkey company is realty wealth advisors and their internal property management company is Zuluscape. The property has been a total chaos from the start. I purchase this property due to its features, built in 2004, nice neighborhood, and etc. The purchase price was higher than the other properties and had lower rent to purchase ratio (0.9). But from reading all of the post on biggerpockets, this property seemed like a safer choice. I inherited their current tenant. But it was a bit strange because initially property manager told me it would be vacant and the house will be "updated" but during the closing process they noted that current tenant decided to stay. So from starting 1st month, the tenant didn't pay but they paid a month late. For the next 4 months, I had issues with communication with the property management on the status of the rent. I would receive rent payments randomly and property manager keep suggesting for eviction. Also, this company's contact structure is abit complicated. I would need to talk to 4 different person for different issues and I never felt like anyone understood the complete picture. The typical conversation would end with "I will get back to you" but they never do... I usually end up contact them back after a week later for the status. I also had couple of repair issues starting the 2nd month of about $585 but despite having a 1 year warrantee and having an inspection done 2 month ago.  I requested if they can cover the repairs since I just purchased the property and they said no because I didn't purchase this property through their internal network but through Jason hartman.  During October, we started eviction for the tenant and we took possession of the house about a week ago. (this process also took 1 month longer than PM advised). So now, they sent me a turnover renovation quotation for $10900!! This is not including 2 month of loss of rent (so far), attorney fees for eviction. lease turnover cost, and etc.. I tried contacting Jason hartman network but my advisor left for another company. I dont know what to do.. please help.

@Jonathan Twombly 

Thank you for your detailed explanation! Your summary greatly clarified my understanding of the current situation. As you noted, both economic and housing correction is on the horizon. With the current global fiscal tightening stands and historical high valuations, our risk for correction is probably higher than ever.

So should I wait until the market corrects? As with most investors, I was looking at rust belt markets with cash flow, specifically turnkey models (purchase at retail price). In my view, diverting my investments to midwest market was my method to hide out from the market correction, or at least partially. After reading your post, I am stuck again in “analysis paralysis” mode, specifically that investors that purposely overlooking midwest market even with higher cap rates. As conservative investor, any suggestions on the overall strategy? As a non-accredited newbie investor, I don’t see much passive options for real estate.

I am sure there isn’t a concrete answer for this but please let me know if you can clarify or suggest any reading materials on this topic. Thank you!

@Michael Lewis Thank you for your reply and valuable info! Do you sell turnkeys??? 

@Ross Denman Thank you for the wealth of information. I will start mapping/organize out the detailed town information! 

@Ritch Bonisa Thank you for your reply! In regards to high % of Home ownership rates and I had few questions. Usually, B+/A neighborhoods have higher home ownership rates therefore it is a more stable market with slightly higher appreciation rates? I understand that ROI will be typically lower. Or is it that McCordsville's home ownershipment rate is extremely high and there isn't much rental demand at all?

@Mike D'Arrigo Thank you for your reply! I will be in touch shortly! 

@Michael Thompson Thank you for your reply! Is the vacancy rates higher for smaller/remote towns?

Hello, 

I am newbie investor looking into Indianapolis turnkey properties and was hoping for some feedback on the location of the turnkey. I have looked at several turnkey properties online and I was wondering if the distance to the center of the Indianapolis was a concern.  

I am currently searching for 110-140K properties in B+ or better neighborhoods, preferably in a newer development, (cookie cutter house) 

Are towns like, McCordsville (30 min commute) & Muncie (60 min commute), outside the 465 Loop safe investments for the long term? I started to have concerns when I read a post regarding "Anderson" township in Indianapolis where housing demand fell greatly due to large company leaving the town. Would choosing a town closer to the Indianapolis downtown a safer choice?  I am assuming most of the jobs are near the indianapolis main hub but I am not sure.  

Thank you in advance. 

I'm interested as well! Please add me to the list

@Jay Hinrichs Thanks for your advice on the importance of PM. From reading the posts, it seems like there are only few turnkey companies with great PM AND extensive history. So assuming equal PM, what would be second most important factor for long term investing? I realize I can't analyze all of these factors so I'm trying to make this as simple as possible.  

@Alex Craig Thank you for the advice. Actually I wouldn't mind the smaller population as long as its diversified enough. I will look into the little rock market as well. 

@Ali Boone Thank you for the advice. I actually started by just looking at individual deals in different markets and I realized I didn't have enough reference background information to dissect the deal. 

Hello, this is yet another newbie turnkey rant! 

After reading many posts on this forum,talking to several "recommended" turnkey providers, and researching the typical linear markets that turnkeys operate in, I am still not sure how to weigh these different criterias to make an informed decision. 

So about market due diligence... I am willing to put some effort and I have already invested hours into market research. I gathered the recommended criterias like job growth, population trends, housing prices, diversity in industry, and etc. So how do you interpret this data? 

And in a typical turnkey markets, like Memphis and Indianapolis, Is high saturation of these mega turnkeys a bad sign in the long term?? I also heard of these "hot" rentals for a several years now